Confederation of All India Traders has made a Request for Strict action against foreign funded E- Commerce entities which are violating the FDI Policy in E-commerce and destroying small shops in the Country. Full Text of their representation is as follows:-
Confederation of All India Traders
Vyaper Bhawan
925/1, Naiwala, Karol Bagh, New Delhi-110005,
Phone: +91-11-45082664, Telefax: +91-11-45082665
E-mail: [email protected] Website: www.cait.in
Ref. No.: 3237/1/50
15th June 2021
Shri Narendra Modi
Honible Prime Minister
Government of India
New Delhi-110011
Respected Shri Pradhanmantrifi,
Subject: Request for Strict action against foreign funded E- Commerce entities which are violating the FDI Policy in E-commerce and destroying small shops in the Country.
We, the signatories of this letter, crave leave to invite your kind and immediate attention towards continuous & repeated violations of FDI in E commerce policy and different rules and laws by several foreign funded e commerce companies operating their business activities in India since a long time and their calculated but a hidden agenda to control, dominate and monopolise not only the e-commerce but even the retail trade of India by highly disturbing market algorithm and displacing small traders of the Country with their livelihood. These foreign funded e-commerce companies prominently Amazon & Flipkart are indulging into unethical business practices and treating India as a banana republic having weak laws and rules. It appears that their objective is to become the second edition of East India Company with a defined mandate to conquer economic activities being carried out by more than 8 crore small businesses of the Country which are providing employment to more than 40 crore people of India.
It is with deep pain and anguish that we are writing this letter to you with a request to initiate strict action against Amazon, Flipkart and other foreign funded e-commerce companies that have been destroying traditional retail trade and small traders for their self-serving gains. It appears that the e-commerce landscape of the Country has been converted into a ground for valuation games instead of conducting business activities which can never be the objective and intention of the Government.
The small Kirana retailers are greatly suffering due to anti-competitive and anti-Kirana policies of these foreign e-commerce entities even during COVI D-19 pandemic that has ravaged the retail sector and has severely impacted our lives, livelihoods and the welfare of our families.
We compliment the Government led by your good self to bring amendments and clarifications in the year 2018, in Press Note 2 of the FDI Policy making explicit provisions that foreign e-commerce companies will act as ‘ marketplace’ providing only technology facilities for both sellers and the consumers to sell and purchase goods and will work as enabling platform for conduct of online businesses. According to well defined provisions of the said Press Note, predatory pricing, deep discounting, loss funding, controlling inventory, preferential sellers or private labels have been expressly prohibited and it was expected that foreign entities will adhere to strictly comply with these provisions. Shri Piyush Goyal, Hontle Minister for Commerce & Industry, at several occasions in the past more than two years, in a most unambiguous manner has amply clarified the intentions of the Government that policy has to be obeyed by such entities both in letter and spirit and no violation of the policy, rules or the law will be tolerated. However, we regret to state that these foreign e-commerce entities left no stone unturned in violating basic fundamentals prescribed in the said Press Note No.2 .
According to stipulations of the Press Note 2 of the FDI policy, these foreign entities are prohibited from engaging in an inventory-based model of e-commerce. But strongly opposing such a clear provision, the Amazon, Flipkart and other foreign e-commerce companies have been undertaking inventory-based retail and no action has been taken against them. It seems like the law is not being equally applied to large foreign entities by various Government Departments.
We take this opportunity to add that the traders of India are not against e-commerce but are of the considered opinion that e-commerce is the most promising business avenue of the future and traders of India should also adopt e-commerce as a stream of their business beside conducting business activities in their physical shops. However, we stand strongly against unethical business practices and violation of the law. The trading community is committed to ensure that sovereignty of businesses in India should not be compromised and no power or entity should pose a challenge based on unethical business practices. For the traders of the Country, the shop is a sacred place and the seat of Lord Shiva which provides means of livelihood for a large population of the Country. It is not only a commercial place but an epitome of great cultural & social heritage of our great Country enriching the bond of mutual trust & confidence between the sellers & the consumers as also a most vibrant means to undertake social & community building across the Country on a mass scale.
In the light of above, we request for your inure ediate intervention in this burning issue and urge upon you to direct the concerned Authorities to issue immediately a new Press Note removing any escape route or loopholes of Press Note No.2 of the FDI policy. It is further requested that a Regulatory mechanism like Telecom Regulatory Authority of India (TRAI) may be constituted to monitor and regulate e-commerce business in India duly empowered to take strict actions in. case of any violation of the policy, rules or the law. It is further requested that .a survey may be conducted to understand how many small businesses have been closed or at the verge of closure due to unethical business practices of foreign entities in e-commerce.
We are sure that it will receive your kind attention and you will be kind in taking necessary action. Jai Hind.
Thank you. With highest regards Truly yours
Praveen Khandelwal
National Secretary General
