Days after the draft ecommerce policy was prepared and shared with the members of the government-appointed ecommerce think tank, sellers associations such as the All India Online Vendors Association (AIOVA) are set to give their feedback to the government on the draft.
An AIOVA spokesperson said this feedback will be shared with the government and has also been shared with the Confederation of All India Traders (CAIT), which is set to have a meeting in Delhi on Wednesday (August 8) regarding the policy.
One of the talking points of the feedback includes a demand for protection of independent sellers from the ecommerce platform itself acting as a seller.
The draft policy highlights the possibility of allowing a limited inventory-based B2C model for the online sale of domestically produced goods, as long as the company is controlled by an Indian management and foreign equity does not exceed 49%.
“A hybrid model consisting of the platform also acting as a seller cannot be allowed, regardless of FDI norms. The market has to remain neutral,” the seller association has said in its recommendation.
Since the time the government formed the ecommerce think tank earlier this year, seller associations and trade bodies have complained about being left out of the policymaking body.
The AIOVA has also recommended a separate definition for ecommerce of retail goods and highlighted the need for ecommerce to be considered as a separate formal industry. The AIOVA has also recommended ways for sellers to avail of formal loans based on the projection of their retail sales, citing the high interest rate of unsecured loans being brokered by the ecommerce platforms.
The AIOVA, which represents more than 3,200 sellers across India, has also called for the promotion of exports through ecommerce platforms.
Other associations such as the All India Mobile Retailers Association will also participate in the Wednesday meeting along with the AIOVA. The concerns of these associations, along with the overall recommendations from the meeting, will be shared with Union commerce minister Suresh Prabhu.
CAIT secretary general Praveen Khandelwal said that CAIT is looking to raise concerns around the proposed inventory model, and will also ask for a definition of bulk purchases, among other issues.
Draft Ecommerce Policy: A Local Push
The ecommerce policy draft aims to ensure a level playing field for local businesses in digital trade in India, where deep-pocketed foreign companies are investing and contesting aggressively.
Inc42 recently reported that online sellers are seeking interoperability of their reviews and ratings.
The sellers believe that this interoperability will help small sellers escape discrimination from major ecommerce companies since positive reviews and ratings on online platforms help a seller attract more customers and notch better sales.
The government is considering including measures to promote Indian companies by giving them incentives as China did, and engaging with global Internet companies to see if local companies can be given preference on websites within the country.
The IBEF expects the Indian ecommerce market to reach $200 Bn by 2026 while the Indian government’s Economic Survey 2018 revealed that the industry reached $33 Bn, registering a 19.1% growth, in 2016-2017.
With global retail majors such as Walmart, Amazon, and Google battling for bigger pieces of the Indian ecommerce pie, the national ecommerce policy needs to strike a balance between protecting and promoting local traders and sellers while allowing foreign players space to operate in India.
[The development was reported by ET.]