Govt does a U-turn, says e-tailers still barred from sale of non-essentials

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Published: April 20, 2020 3:45:02 AM

The move to allow e-tailers to sell/deliver non-essential items was strongly opposed by small businesses led by The Confederation of All India Traders (CAIT).

The move to allow e-tailers to sell/deliver non-essential items was strongly opposed by small businesses led by The Confederation of All India Traders (CAIT).

In a U-turn, the ministry of home affairs on Sunday said e-commerce companies cannot sell non-essential items such as white goods, electronics and mobile phones from Monday, revoking an earlier decision to allow such sales as part of the guidelines issued on April 15. This means sale of non-essentials by e-tailers will remain prohibited till the lock-down is lifted. The sale and delivery of essentials such as groceries by e-commerce firms will, however, continue. Even brick and mortar stores will continue to sell such products.

“Government has prohibited supply of non-essential items through e-commerce under lockdown restrictions to fight COVID-19,” the MHA said in its revised guidelines issued on Sunday. Home secretary Ajay Bhalla has written to all chief secretaries of states and union territories, conveying the new decision.

The change in stance is understood to have come about, after objections were raised by brick and mortar stores retailing such items, who are not allowed to open and function from April 20 due to lockdown norms. As such, the move was seen as discriminatory.

The move to allow e-tailers to sell/deliver non-essential items was strongly opposed by small businesses led by The Confederation of All India Traders (CAIT). Last week, CAIT had written to Prime Minister Narendra Modi seeking his intervention in the matter. In its submission CAIT had termed the government’s decision allowing online companies to resume sale of non-essential products as “unfair, discriminatory and unreasonable”. CAIT had said it will severely dent the hopes and livelihoods of India’s retailers. CAIT has a pan-India network of 7 crore strong traders.

Small traders are believed to constitute a significant support base to the ruling BJP-led coalition. Praveen Khandelwal, secretary general, CAIT said after Sunday’s decision, “CAIT demolished sinister plan of e-commerce companies to trade in non essential commodities. Accepting the objection of CAIT, the MHA excluded the permission granted earlier and now e-commerce can trade only in essential commodities”.

E-commerce companies had last week started taking orders of non-essential items like electronics and mobile phones etc. in areas that don’t fall under Covid-19 hotspots but delivery was to begin from April 20 onwards. Amazon India in a statement said the new guideline will disappoint not only the consumers whose list of essentials had expanded to work from home and study from home products but also the thousands of small businesses, sellers and manufacturers across the country, who had geared up in the last 48 hours to provide millions of people with safe access to products.

Flipkart did not comment on the matter. “We support the government’s decision in spirit to limiting e-commerce operations to essentials. However, we believe that the ambit of essential goods should be increased,” Paytm Mall said in a statement. Products such as laptops, mobile phones, accessories, computer hardware should be allowed to be part of essential goods, Srinivas Mothey, senior vice-president at Paytm Mall said.

”E-commerce can serve the customer’s needs, and this should be enabled without defining the essentiality of goods. Consumption growth needn’t be stopped and can be supported,” said Arvind Singhal, CMD at Technopak. “Government’s decision to continue with the restrictions on e-commerce from April 20 is a very impractical and inexplicable move,” Singhal added.

“We will continue to operate in complete compliance with the guidelines issued by the government in this regard,” a spokesperson at Snapdeal said.

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