No threat to food retailing by Amazon

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Published: January 4, 2019 3:45:13 AM

Currently, the government allows up to 100% FDI in e-commerce marketplaces via automatic route but no FDI is allowed in the inventory-based model (barring food retail).

Currently, the government allows up to 100% FDI in e-commerce marketplaces via automatic route but no FDI is allowed in the inventory-based model (barring food retail).

The government on Thursday clarified that the latest rules for e-commerce companies with foreign investment such as Amazon and Flipkart, which barred online marketplaces from holding inventory, would not be applicable to the retailing of food products. This means Amazon, Grofers and Big Basket, which have already got the government’s approval to sell locally-produced food products, can hold inventory of such items without any restriction. Currently, the government allows up to 100% FDI in e-commerce marketplaces via automatic route but no FDI is allowed in the inventory-based model (barring food retail).

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