Govt considering certain clarifications on FDI in e-commerce sector: Piyush Goyal

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Updated: Feb 09, 2021 10:43 PM

Goyal said the current FDI policy for the e-commerce sector is robust and well-designed. However, there are certain complaints from consumers and small retailers about certain practices of the e-commerce companies, which are under investigation, he added.

Piyush Goyal

Amid domestic traders complaining alleged violations of FDI norms by foreign online players, Commerce and Industry Minister Piyush Goyal on Tuesday said the government is considering coming out with certain clarifications to ensure that the e-commerce sector works in the “true spirit” of the law and rules.

He said the current FDI policy for the e-commerce sector is robust and well-designed. However, there are certain complaints from consumers and small retailers about certain practices of the e-commerce companies, which are under investigation, he added.

“We have sought several information, they are being looked into. We are also considering certain clarifications to ensure that the e-commerce sector works in the true spirit of the law, of the rules that have been laid down for e-commerce,” Goyal told reporters.

The minister was replying to a question whether the government is re-looking at the FDI policy for e-commerce as Indian traders have been complaining about malpractices by some MNC online platforms.

“There is no change in the e-commerce policy per se. The e-commerce policy is robust, well designed and operating in India in several sectors,” he said. PTI RR

He added that e-commerce companies are supposed to provide an agnostic platform so that buyers and sellers can trade with each other.

The online platform should not become part of the trading transaction, “should neither be funding it, should neither be having algorithms which give preference to one or the other, should neither be promoting their own products.” But, it should provide all data that is required for a rational choice, and the choice should be a free choice of the consumer, Goyal added.
The buyers and sellers should be given an opportunity to trade with each other as the platform only is a service provider, he said.

“Those who break that law will certainly have to respond to our concerns and correct their business practices at the earliest,” the minister added.

Recently, the ministry has forwarded representations by the Confederation of All India Traders (CAIT) of alleged violations by Amazon and Flipkart to the Enforcement Directorate and the Reserve Bank of India for “necessary action”.

CAIT has time and again alleged that the e-commerce players violated the Foreign Exchange Management Act and FDI rules.

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