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Foreign-owned e-commerce firms vs Kirana stores: Why Brand India matters

Brand India cannot witness another round of subversive capital colonialism and this is exactly what we are seeing.

July 15, 2021 / 05:30 PM IST

Over the last few weeks, we have seen a lot of anguish on part of the Indian trading community which is in essence the backbone of our retail economy. The hardships they have had to entail with the advent of unmindful and unregulated e-commerce sites have resulted in the closure of over 20 lakh establishments and almost 2.5 crore jobs that have evaporated and that too during a pandemic which has unleashed its own havoc.

Subversive capital colonialism

Many have erroneously termed it as a battle between Swadeshi and Videshi which again is a very myopic way of looking at things. Jingoism has no place in commerce but neither does the blatant use of illegality when it comes to foreign-owned e-commerce companies which are using cheap American money to create a level of subventions which have driven the long-standing retail business in our country out of business and to everlasting despair.

This needs to stop.

Brand India cannot witness another round of subversive capital colonialism and this is exactly what we are seeing. Almost 20 years ago, when METRO came into India, there were gross legal violations that were unearthed by the government. While the model of business was supposed to be a B2B one, it conveniently changed to a B2C model with individual non-registered buyers walking in thus proving a counter to the trade that would ordinarily have happened through our trusted Kirana stores. I was witness to the enormous sacrifices that our very own trading community made and the manner in which they put duty above life when the pandemic had crippled the movement of goods: where were the Amazons and Flipkarts then? It was the local store which kept kitchens running more often than not, on credit given the destruction of wages and income that was prevalent then. And how are we rewarding them? By pussy-footing on the implementation of existing rules and laws. In a manner of speaking, ironic as it is, we are welcoming back a version of Robert Clive 2.0.

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This too needs to stop.

Given what most foreign companies do, the battles were swiftly taken to court and what was startling was that fierce competitors who never come together for anything OR on any platform were unstinted to ward off their illegalities taking cover of our courts. But hopefully, the fairness and robustness of our judiciary will see them being made accountable in what will be a long and torturous journey but in which the hapless small trader will again be the pawn. I am yet to figure out how these companies have flown in the face of all measures of legal compliance something that the judiciary needs to intervene and correct. We can’t be seen as a country with dual laws: one for Indian companies and another for foreign ones.

What is surprising is that when Prime Minister Narendra Modi was the chief minister of Gujarat, on September 14, 2012, he criticised the then UPA government in unambiguous terms for opening up multi-brand retail to foreign entities without taking cognizance of what would happen to the Kirana shop owners and their workers. That was in 2012.

Today we are in 2021 and the prime minister is being let down repeatedly by the bureaucracy which creates vagueness in rules that has allowed these foreign entities to operate without impunity. Vested and conflicted interests are there for all to see and are the subject matter of legal representations. But that has still not pushed the government to act.

When will this blatant disregard for Indian Sovereign laws stop?

What is heartening to note is that both the prime minister and Commerce Minister Piyush Goyal, in all their public utterances, continue to underscore the importance of protecting the Indian retailer whilst punishing anyone who breaks the law; however, nothing much seems to be happening. All this while, we have had our home-grown retailers both online and offline suffer as these foreign companies go about their business without fear. If it were an Indian company violating these laws, there would have been criminal and civil action but it seems what is good for the goose is not good for the gander.

Equality of opportunity

For Brand India to succeed it must carry every Indian and every Indian dream forward based on both the equality of opportunity as also the opportunity of being legally compliant. I was quite shocked to see the House of Tata actually come out in support of these foreign entities. Having been involved with the House of Tata for over three decades, until recently, it is not just heart-breaking but staggeringly difficult to digest.

I am certain the patriarch of the House of Tata, Ratan N Tata, an avowed Indian and ethical to boot, would have never approved of such a move.

I am certain that the prime minister has his heart in the right place: from all that he has admirably done: be it Digital India or Start-Up India, he has exhibited a deep and abiding faith in India and Indian capabilities.

It would be a shame to see his idea of Atmanirbhar Bharat swiftly morph into Atmanirbhar America only because there are some in the government who are willing to act as saboteurs for this dream of an inclusive Brand India. An India which is not only seen to be fair but in reality is so as well.
Suhel Seth is Managing Partner of Counselage India.
first published: Jul 15, 2021 05:26 pm

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