Post backlash, review of draft e-com policy


NEW DELHI: After receiving negative comments and protests from various quarters including some ministries over the proposed e-commerce policy, Commerce Minister Suresh Prabhu has instructed to carry out fresh round of consultations with all stakeholders to address the concerns raised.

“The ministry had received a few concerns regarding the draft e-commerce policy, following which CIM (Commerce and Industry Minister) @sureshpprabhu has directed officials to conduct another round of consultation with stakeholders to address them. The minister will personally review the draft once it is prepared,” a tweet from the Commerce Minister’s official Twitter handle stated on Saturday.

The draft e-commerce policy suggested by the task force was criticised by online players for its proposal for introducing a sunset clause for offering deep discounts to customers. The clause was to define the maximum duration of differential pricing strategies implemented by e-commerce companies. This means any group company of an online retailer or marketplace may not be allowed to directly or indirectly influence the price or sale of products and services on its platform, a move that could completely restrict e-tailers from giving deep discounts, which is a major promotional strategy for most firms.

International players have also raised concerns on the proposal for data localisation. The task force had put forth that data generated by users in India from various sources including e-commerce platforms, social media and search engines should be stored exclusively in the country and, if required, the local data should be shared. This hasn’t gone down well with Amazon, Walmart and Ebay, among others.

Further, the draft had recommended permitting 49 per cent FDI in inventory-based business to customer e-commerce model. Currently, the FDI is restricted only to the marketplace model. The move was opposed by the Confederation of All India Traders.

“Every stakeholder has a different concern. So, the ministry has decided to do the consultations once again. This will give us chance to address their concerns more efficiently. This is a draft and we always said we are open to suggestions,” an official from the commerce ministry said.


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