As the retailers versus e-tailers fight gains momentum, industry body CAIT sought Competition Commission of India’s intervention against deep discounting by e-commerce platforms such as Amazon and Flipkart. “The government should now take immediate action against Amazon and Flipkart,” CAIT said in the light of Commerce Minister Piyush Goyal’s recent comments that the government is probing the e-commerce platforms for alleged predatory pricing. “The statement [Piyush Goyal’s] has come at a time when the offline business of the country is badly plagued by the unethical business model of these two companies since they are indulging in predatory pricing, giving huge discounts and compensating the losses to their sellers,” BC Bhartia, National President of CAIT and Praveen Khandelwal, Secretary-General, said in a note.
CAIT has alleged that the unethical commercial practices of major e-commerce platforms in the country have cost the business of about 40 thousand mobile shops which are likely to get shut by Diwali. CAIT added that items in FMCG, electronics, electrical, gift items, and garments etc have suffered huge losses in the offline market due to online festival sales via these platforms. “Trade in the mobile sector has fallen to about 60% whereas in other sectors it has registered a decline of 30% to 40% sales. Other business sectors such as footwear has fallen by about 30 to 40 per cent in the month of October,” CAIT said in a statement. The confederation of all India traders has been a vocal critic of the business models of Amazon and Flipkart and has been asking the government for stronger rules.
While Amazon and Flipkart continue to diss claims of any negligence on their parts, Rajneesh Kumar, Corporate Affairs Officer, Flipkart, told Financial Express Online that the company is “deeply committed to doing business the right way in India and appreciate the consultative approach that the Commerce Ministry & DPIIT have taken.” He added that Flipkart continues “to be willing to work with the government and all stakeholders to promote a regulatory environment that creates balanced growth that is good for India.”