CIAT’s Desi e-commerce venture to take on Amazon, Flipkart
NEW DELHI: The Confederation of Indian Traders (CIAT) will soon start a nationwide-registration process of the traders/ shopkeepers from all over the country to bring them onto an e-commerce platform which is expected to be launched in August.
A pilot project of the initiative has already begun in Madhya Pradesh where individual e-stores have been created for the traders, CAIT, General Secretary, Praveen Khandelwal said. The nationwide programme of creating a coherent B2B and B2C e-commerce platform for small retailers/ traders of the country will take next four-five months. Most likely, the platform will be launched in August, Khandelwal said, adding that traders would comply by the regulatory process and required license that may be needed to operate such a platform. The announcement has come at a time when the CAIT, an association of 70 million traders from the country have registered strong protest against e-tailers like Amazon and Walmart backed Flipkart accusing them of flouting the Foreign Direct Investment (FDI) rules.
CAIT had recently written to PM Modi, finance and commerce ministries seeking a ban on the major e-commerce sites accusing them of deep discounting, predatory pricing and preferential treatment to select traders which has caused a huge revenue loss to the local business ecosystem as well as to the government. The Competition Commission of India (CCI) has already initiated an investigation into the allegations made by a Delhi traders body against e-commerce portals accusing them of violating various provisions of the Competition Act (2002).
The CCI has ordered its Director General to investigate the violations of the Section 26(1) of the Competition Act,2002 and submit the findings within 60 days. The e-commerce industry in India expected to cross $120 billion in 2020 growing at compounded annual growth rate of 51%, may overtake US soon to become the second-largest market globally. With 100% FDI allowed in the e-commerce sector, the investments into the industry crossed $7 billion in 2018, as per a report by India Brand Equity Foundation. Amazon chief, Jeff Bezos during his recent India visit announced that the e-commerce giant would pump in $1 billion to bring Small and medium businesses in India onto the platform which took the total amount invested in India to $6.5 billion
Cashing in
American retailer, Walmart acquired a major stake (77%) in Flipkart in 2018 through a $16 billion deal and the analysts believe that Walmart was able to receive 50% of returns within a year of the deal.