The government’s stand on B2C FDI remains unchanged

While Indian government is in discussions with domestic and ecommerce platforms regarding foreign direct investment (FDI) in online multi-brand retail, it has said that the rules remain unchanged for now. After meeting the stakeholders and hearing their point of views, Commerce and Industry Minister Nirmala Sitharaman said the government is yet to take a stand on allowing FDI in e-retail.

“We have heard everybody. Positions on whether they need FDI or do not need FDI and whether it will affect level playing field have been explained. However, we need many more meetings,” she said. While domestic biggies such as Flipkart and Snapdeal opposed foreign investment in B2C a meeting by Sitharaman, with foreign entrants - Amazon and eBay spoke strongly in favour of it.

Around 60 players from the industry, including representatives of Amazon India, Snapdeal, Ikea, Japan Plus, eBay and Flipkart attended the meeting. While Amazon and Walmart have been lobbying to get access to the inventory-based model in India, where they can sell own products directly to consumers, at present, 100 percent FDI is allowed only in marketplace models, a company can provide an online platform to local vendors to sell their products in return for a commission. Amazon has asked the government to allow 49 percent foreign direct investment in e-tailers selling directly to consumers.