E-commerce policy: Heavy discounts offered by Amazon, Flipkart may end soon; here’s how

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Published: July 31, 2018 12:01:38 PM

The suggestions shared by various industry-government working groups on e-commerce, if completely endorsed by the government, may end heavy discounts offered by foreign e-tailers such as Flipkart and Amazon.

On Sunday, the two of the biggest e-commerce websites Flipkart and Amazon went head to head against each other.The foreign e-commerce firms which are operating in the country may also be asked to store consumer data locally.

The suggestions shared by various industry-government working groups on e-commerce, if completely endorsed by the government, may end heavy discounts offered by foreign e-tailers such as Flipkart and Amazon. If the suggestions by think tank finds place in the final draft policy, a watchdog may look into the alleged abuse of FDI rules through heavy discounts by these e-commerce majors. The stakeholders, including private sector and government officials from different departments such as commerce, industry, IT and electronics, formed part of think tank.

It has been recommended to establish a maximum duration for differential pricing or heavy discounts. The 19-page document circulated by the government clearly also talks about “boosting the domestic digital economy to find its rightful place with dominant and potentially non-competitive global players.”

The foreign e-commerce firms which are operating in the country may also be asked to store consumer data locally within two years, according to the draft recommendations. The foreign direct investment FDI rules may be eased by allowing e-commerce marketplaces to hold inventory of locally-produced items, according to one of the suggestions. A separate wing in the Directorate of Enforcement will be established to look into complaints related to implementation of FDI rules.

Just like other e-commerce players claim that they have always complied with the rules and that the discounts are offered by the sellers of the goods on their platform, and not themselves, Financial Express reported citing Amazon and Flipkart.

Commerce secretary-designate Anup Wadhawan said the think tank on Monday deliberated upon the suggestions by various working groups, comprising industry and some government officials, and a final draft policy will be put out in due course.

According to one of the suggestions, a restriction must be imposed on e-commerce marketplaces to not directly or indirectly influence the price of sale of goods and services.

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