Government not against “flash sales,” but will not tolerate “cheating” on e-comm platforms: Piyush Goyal
New Delhi, April 25, 2023
The government is not against discount offers and “flash sales” on e-commerce platforms but will not tolerate “cheating” where marketplaces sell their wares through such sales even though the country’s foreign direct investment (FDI) policy does not allow them to sell directly to consumers, Commerce and Industry Minister Piyush Goyal said on Tuesday.
Assuring that the Centre will bring out an e-commerce policy which addresses such sales, Mr. Goyal also pushed for all e-commerce players as well as large corporates like ITC and HUL to join the government-backed Open Network for Digital Commerce (ONDC) platform, and mooted setting a deadline for such players to onboard it.
He also urged the ONDC top brass to shun players that make an ONDC-specific platform. “That is exactly what we don’t want to have. We want the main platform to come on to ONDC… that is an unfair way to try and get the benefits of ONDC as a seller but not offer all the buyers that come on your platform to get a chance to go to ONDC,” he said.
On the issue of flash sales, the minister said: “If consumers are getting a good deal, we have no problem. But our objection is two-fold – [Apart from the FDI policy breach] one is what China did to Indian manufacturing through predatory pricing, dumping goods at very low prices for a long time and kill domestic production so the consumer has no choice ultimately and then they can charge an arm and leg afterwards.”
“The other aspect was that marketplaces which are not allowed to do B2C sales as per the FDI policy…what they are doing is – the consumer comes to a platform from where there’s a flash sale, electronically, it goes to the marketplace and the preferred seller gets to sell. That is cheating and we are only trying to stop that cheating through the e-commerce policy that we are coming out with,” he asserted.
“The FDI laws have to be respected. The marketplace has to operate as a marketplace. They can sell other products as their single brand outlet, we have no problem. But you can’t mix the marketplace model with your single-brand retail model. This is very close to my heart and my heart beats for those millions and crores of small retailers for whom I am worried,” Mr. Goyal noted.
Highlighting that the US and many developed economies have seen Mom and Pop stores “literally disappear and all shut down”, the minister said Prime Minister Narendra Modi’s government stands with the small retailers.
“We will stand till the end to ensure that we protect the small retailers and give them a bright future and am grateful for all the support we get from Indian companies in this effort too. Indian and foreign, we would request all companies to support this,” he concluded.
[The Hindu]
