New FDI policy on e-commerce: Domestic retailers welcome move
The government on December 26 announced several restrictive changes to the FDI policy or online retailers.
December 29, 2018 / 03:34 PM IST
After the Centre announced new changes to the FDI policy for e-commerce, aimed at checking predatory pricing and deep discounting, domestic retailers feel it will bring a "level-playing field" for offline and other retailers in the market, as per a report in Business Standard.
The government on December 26 announced several restrictive changes to the FDI policy or online retailers. These changes are aimed at checking deep discounting and predatory pricing. According to the new changes, the government has barred online retailers from entering exclusive deals for selling products on their platforms.
The government has also enforced a 25 percent cap on the inventory that an e-commerce platform can purchase from a single vendor.
The changes will come into effect on February 1, 2019.
"The FDI-funded discounting was making it difficult for offline retailers and other players to sell effectively. These (new changes) will bring a level playing field in many categories," Rakesh Biyani, joint managing director, Future Retail, told the paper, adding that the new changes will help domestic companies in building a robust business model.
"The government should appoint agencies to ensure compliance of norms and probe any flouting of norms and initiate action against such marketplaces," Kumar Rajagopalan, chief executive of Retailers Association of India, told the paper.