We should construe the efforts of 100 million retailers in the country as we must not cause huge disruption for the retailers, he said. (Image: X @Piyush Goyal)
On Wednesday, Commerce and Industry Minister Piyush Goyal accused e-commerce giants including Amazon of violating FDI rules as the company indulges in predatory pricing intended to grab a huge share. He highlighted that these e-commerce platforms suppress the operations of small businesses while urging a review of policies to ensure the businesses of small shops are not affected by the swift growth of online selling platforms.
He stated that the business with consumers will not befall in e-commerce platforms as per legal terms. Suppose you make a Rs 6,000 crore loss in a year, it is the aftermath of predatory pricing (violating antitrust laws), alleging Amazon for passing off funds conceding losses as investments.
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As per FDI rules, It does not directly allow Amazon, Flipkart or any other foreign-owned entities to sell to the customers or keep hold of the inventory. The rules give them the right to set up platforms helping sellers to pitch their products or goods. Goyal has raised concerns over the operation of e-commerce companies in recent years as well.
He blamed e-commerce players for predatory pricing: If we invest $1 billion in India, we will feat that this may lead to rapid economic growth but there is an underlying story that this invested amount is not going to make any benefit or even support the Indian economy, they chart a $1 billion loss in their balance sheet he asserted, speaking at an event organised by pahle India Foundation.
It has been seen that the e-commerce platforms urge to dismiss the entities when they get caught as the norms were scoffed with Indian entities that the business or transactions are marked as B2B sales. They deliberately mock common people flouting through an entity that is B2B but customers buy on these e-commerce platforms where B2C is prohibited, Goyal said.
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He also pointed out that the e-commerce platforms are a threat to millions of small retailers because they are focused on high-margin products and the online sales can be around half of the whole retail market in the country, it is a matter of concern, he reminded.
Goyal sought our attention that big stores by major companies like Apple shut down their stores in India confronting sales issues. We should construe the efforts of 100 million retailers in the country as we must not cause huge disruption for the retailers in every nook and corner of the country, even if technology plays a major role it should grow along in an orderly fashion paving the way for benefitting a larger section of the society, he added.
