India’s First Ecommerce Think Tank Meet To Be Convened By Suresh Prabhu

Suresh Prabhu, the commerce and industry minister, will be holding the first ecommerce think tank meeting today. The minister will chair the meeting which will aim at framing a national policy on ecommerce.

Speaking the initiative, the department of commerce said in a statement, “The think tank on the Framework for National Policy on ecommerce will seek to collectively deliberate on the challenges confronting India in the arena of digital economy with a view to developing recommendations for a comprehensive and overarching national policy on ecommerce.”

The minister will be taking up many key issues for discussion during the meeting. Some of the issues that will be discussed are: physical and digital infrastructure, regulatory regime, taxation policy, data flows, server localisation, intellectual property rights protection, FDI, technology flows, responding to disruptions in industrial organisation, need for skill development and trade-related aspects.

The setting up of this ecommerce think tank and the initiative taken by the ministry may well be interpreted as the government and its allied bodies beginning to understand the growth potential of the ecommerce industry in India and how well it can play to boost the Indian economy.

Though the ecommerce think tank is being led by commerce and industry minister Suresh Prabhu, it includes officials from ministries of finance, home affairs, corporate affairs, and electronics and information technology, among others, besides representatives from telecom, IT and ecommerce firms including Bharti Enterprises, Reliance Jio, TCS, Wipro, Ola, Snapdeal, Makemytrip, UrbanClap, Justdial, PepperFry and Practo.

As earlier reported by Inc42, the ecommerce policy is being seen as a critical step taken by the Indian government following the international attention on the ecommerce segment. A group of 71 WTO countries has launched intensive discussions on ecommerce and also, recently met for the first time in Geneva with 13 other delegations.

Soon after reports of ecommerce think tank surfaced, Union Commerce Secretary Rita Teaotia revealed that the government has also set up an inter-ministerial group to study issues related to ecommerce sector in the country.

She also emphasised that ecommerce sector is growing rapidly in the country, however, she highlighted that there was no time-frame for coming out with recommendations.

The policy developments come at the time when a group of brick and mortar retailers including Future group and Reliance Retail and ICA have alleged that ecommerce companies like Flipkart and Amazon India are violating FDI rules by “influencing prices on their platforms and illegally funding abnormal discounts”.

Both Flipkart and Amazon India have given media statements indicating that on their part, they have been fair and have not been flouting the FDI rules in any manner.

However, recently Inc42 reported that the Ministry of Commerce and Industry has asked the RBI and the Enforcement Directorate aka ED to look into the allegations. As per the reports, the ministry, which forwarded the ICA’s letter to the RBI and ED late last month, asked them to take the necessary action.

The IBEF expects the Indian ecommerce to reach $200 Bn by 2026 while Indian government’s Economic Survey 2018 revealed that India’s ecommerce market reached $33 Bn registering a 19.1% growth in 2016-2017. As the government sets up a think tank to look into India’s policy on ecommerce, the nature in which the case of alleged FDI violations will shape up may also serve as a major change-maker in the ecommerce sector.