These proposals are part of a 15-page ecommerce policy draft prepared by the Department for Promotion of Industry & Internal Trade.
The government may impose stricter conditions on foreign internet companies such as Amazon, Google and Facebook.
The draft ecommerce policy also proposes appointment of an ecommerce regulator to ensure fair competition in the industry, Bloomberg report has said.
Moneycontrol could not independently verify the story.
The draft comes amid the government's push for locally manufactured products and after the government banned 59 Chinese apps, including online retailers ClubFactory and Shein.
The 15-page draft on ecommerce policy, viewed by Bloomberg, has been drawn up by the Department for Promotion of Industry & Internal Trade (DPIIT).
The suggested norms may mandate that online companies provide the government access to their source codes and algorithms, the report said.
The commerce ministry wants to prevent "digitally induced biases" by competitors, the report said.
The draft policy also intends to assess whether ecommerce companies have "explainable" artificial intelligence, the report said.
"It is in the interest of the Indian consumer and the local ecosystem that there are more service providers" and that "the network effects do not lead to creation of digital monopolies misusing their dominant market position", the draft policy said.The commerce ministry will upload the draft ecommerce policy on a government website and invite comments from stakeholders.