After state governments and some domestic e-retailers raised concerns about India’s new e-commerce rules, the Union Commerce Minister Piyush Goyal has indirectly accused US-based e-commerce giants, Amazon and Walmart of arrogance and flouting Indian laws.
Goyal, during an event at the Standford India Policy and Economics Club, said these companies were using their scale and access to large pools of low-cost capital to indulge in predatory pricing practices to the detriment of mom-and-pop stores. “A number of these large e-commerce companies have come into India and very blatantly flouted the laws of the land in more ways than one,” he said. “I have had several engagements with these large companies, particularly the American ones, and I can see a little bit of arrogance.”
The minister also criticized the companies for indulging in forum shopping in courts and failing to comply with an investigation launched by the Competition Council of India (CCI). Earlier this month, the Karnataka High Court dismissed pleas by Amazon and Walmart’s Flipkart to quash an anti-trust investigation into their business practices.
When the competition watchdog ordered its investigation, it had listed four alleged anti-competitive practices, which were exclusive launches of mobile phones by the e-commerce firms, promoting preferred sellers on their websites, deep discounting practices and prioritizing some seller listings over others. However, time and again Amazon and Walmart have denied the allegations, leveled against them by the government and the traders.
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“To my mind, if they have nothing to hide, if they are doing honest business practices, why don’t they respond to the CCI?” Goyal said. Moreover, in a letter to Prime Minister Narendra Modi, the Confederation of All India Traders accused e-commerce companies of treating India like a banana republic with weak laws. It urged the government to ensure that the proposed e-commerce rules were not diluted, despite the lobbying efforts of the companies.
