Yebhi & Fashionandyou to appeal for FDI in e-commerce

The demand for foreign direct investment (FDI) in India’s e-commerce has got more

supporters. Online shopping platforms Yebhi and Fashionandyou have now decided to submit a petition to Prime Minister Narendra Modi for allowing foreign investment in B2C companies to compete against Chinese firms.

The department of industrial policy and promotion (DIPP) has also decided to push for FDI in e-commerce. DIPP held a stakeholders meeting recently, to firm up its views on the issue. While big ticket players like Walmart and Amazon have been pushing for the FDI in e-commerce for quite some time, the current FDI policy does not allow foreign direct investment in business-to-consumer e-commerce. However, 100 percent FDI is allowed in business-to-business e-commerce.

Indian players as well as global giants like Amazon and Walmart have been lobbying for FDI in e-commerce. Most e-platforms have been shifting to a marketplace model of late in a bid to raise funds from global investors. While Snapdeal has been a marketplace company, Flipkart recently shifted from an inventory-led to a marketplace format.

DIPP had floated a discussion paper in January detailing the pros and cons of allowing FDI in the sector where 100 percent FDI is already allowed in the business-to-business (B2B) e-commerce space. It had sought recommendations from various stakeholders by January 28.