Aug 17: India is likely to stiffen its norms over e-commerce in the country, and as a result, foreign players could be facing some serious competition. As per the new draft of the e-commerce policy, foreign-funded firms including the likes of Amazon and Walmart will have to jump more than a few hurdles to carry forward its operation.
Among the norms, inventory holding proves to be among the serious concerns as foreign-funded forms won’t be allowed to hold e-commerce inventory in India once the draft e-commerce policy becomes a law. With this, companies like Amazon will be barred from fully utilizing its logistic operations in the country.
Additionally, there will be further curbs on discount offerings on the platforms, which would be another major setback for e-commerce firms like Flipkart and Amazon. Phantom sellers have also been brought under the radar in the new draft policy, and this could put stiffen the inventory woes for foreign players in India.
The above-said however won’t apply for Indian e-commerce firms, and this should give a huge space for Reliance Retail Ltd, which is gearing up to square against Amazon in a fully-fledged manner. The draft gives further control for Indian-managed companies, and also let them improve their supply chains along the process.
If that turns true, country’s current e-commerce leader Amazon will have its strongest rival in Reliance Retail. This is apparently in contrast to the common notion that Walmart would emerge as the strongest rival for Amazon.
In addition to aforesaid, there are also several other norms that are likely to be setback for Amazon and other foreign players. While some of them are unlikely to make it to the final policy, others like having data centers set up in the country are likely to be implemented.