NEW DELHI: The Union Minister for Commerce and Industry Ms Nirmala Sitaraman said that the Government is working over an elaborate and logical definition of e-commerce in the country. The Minister also added that her ministry is looking into the key issues in e-commerce such as Taxation and the limit of FDI etc, to solve the disputes between the States and the e-commerce firms.
e-commerce has been a rapidly growing platform in India, in the recent times. several new startups having been gearing up in the e-commerce sector of the sub-continent to make it a boon for them. In the last two years, every new startup has come up with an innovative solution for every need of the customer. All the essential items ranging from Spectacles and groceries to furniture and electronic gadgets can now be purchased at a best available cost online.
However, this has surfaced new problems to the government. Since e-commerce is a platform which has seen rapid globalization in the recent past, there aren’t any proper rules and regulations from the Government to impose over the e-commerce firms. Taking the advantage of the loophole, e-commerce platforms like Amazon and Flipkart have been funding their business through FDI to a greater extent. To be precise there aren’t any guidelines over the limit of Foreign Direct Investment into the e-commerce platform.
On the other hand, offline retailers have approached the Government alleging that the Online platforms have been drastically lowering the prices of the products they sell by funding them through FDI. They requested the Government to save the offline marketers from the havoc created by the e-commerce, as the number of online purchasers increased day-by-day.
Observing the multiplying problems due to the e-commerce, Minister Nirmala Sitaraman said that the Government will soon release a provisional notification defining the online marketing and also the limits on FDI. “There are several concerns from various sectors over online shopping. We have also received the suggestions and problems faced by the state governments in this regard and the ministry will soon roll out rules and regulations governing the e-commerce”, she said.
“At present 100% FDI are allowed only in Business to Business e-commerce but not in retail e-commerce”, she added.
According to the estimates, the Indian e-commerce has a massive market of USD 5 billion, and is still increasing at a rapid pace.