India’s apex body of traders representing 70 Million people the Confederation of All India Traders ( CAIT) expressed anguish as well as hope on the recent World Bank Report claiming that E- Commerce contributes only 1.6 % of India’s retail sales.
Reacting to the report, Praveen Khandelwal, National Secretary General said that it is pertinent to note that if only 1.6% of Ecommerce sales has potentially destroyed the existing ecosystem of Indian retail due to unethical and predatory business practices by large players such as Amazon and Flipkart then the future seems extremely bleak and grave for India’s small retailers. It is extremely unfortunate that these two large companies who have almost 80 percent market share of India’s Ecommerce business have given our country the most maligned and vitiated foundation for Ecommerce business. As a marketplace entity their prime responsibility was to create a healthy and thriving technological platform to promote the businesses of small sellers by connecting them to potential buyers. But in stark contrast their ulterior and shrouded business motive has been to ensure that small offline retailers perish and shut business so that they can get a strong foothold of India’s retail market. It is really painful to note that in the last 12 months more than 50,000 mobile retailers, 30,000 electronics retailers, about 25,000 kirana and 35,000 garment retailers have shut their business mainly due to these Ecommerce giants who have blatantly violated the Govt’s FDI policy and indulged in inventory control, predatory pricing, preferential seller treatment, illegal exclusivity among other violations. They have consumed most of the FDI for funding the losses on account of deep discounting. So if such companies are allowed to grow in the same manner, we can very well foresee what a precarious future is in store for India.
Balkrishna Bhartia, National President CAIT while acknowledging that Ecommerce is the business model of this new generation and has tremendous potential to change the landscape of India’s retail expressed hope that the Govt will step in immediately and take corrective measures so that the existing anomalies in India’s Ecommerce business are ironed out so as to ensure a holistic and inclusive growth that encourages fair and equal opportunities for both online as well as offline retailers to flourish. Mr Praveen Khandelwal said small traders of India are very keen to jump on the Ecommerce bandwagon and the CAIT will assist these small traders but we can do so only if the Govt extends support by creating a strong regulatory framework with sound policies which does not allow any foreign or domestic company to monopolise or take undue advantage by circumvention of India’s sovereign laws and at the same time takes into account the interest of all small retailers by giving them a fair opportunity to participate in the Ecommerce revolution. The small Traders of India are not averse to any competition or technological upgradation but in the present circumstances and vitiated condition of extremely unhealthy Ecommerce environment it is next to impossible to compete with such deep Pocketed global giants.