Commerce Ministry working on new e-commerce policy to boost online retail

The commerce and industry ministry is working on a new e-commerce policy to boost the fast-growing online retail as well as protect the interest of small retailers, sources said.

The government has already set up a group of secretaries to look into the issues of the sector.

The ministry is committed to preparing the policy to boost the growth of the sector, sources said.

The move came after concerns were raised on some proposals of the draft e-commerce policy, which was prepared after consultations with several stakeholders, including industry chambers.

The draft e-commerce policy had suggested several steps to promote the growth of the sector. It had stated that online retail firms may have to store user data exclusively in India in view of security and privacy concerns.

It had also said that any group company of an online retailer or marketplace may not be allowed to directly or indirectly influence the price or sale of products and services on its platform, a move that could completely restrict e-tailers from giving deep discounts.

The draft had suggested to introduce a pre-set timeframe for offering differential pricing or deep discounts by e-commerce players to customers.
 

Meanwhile, Commerce and Industry Minister Suresh Prabhu informed Parliament the formulation of e-commerce policy is under consideration of the government for which no timeline has been fixed.

Traders body Confederation of All India Traders (CAIT) has time and again raised concerns over heavy discounts being provided by certain online-retailers.

CAIT Secretary General Praveen Khandelwal said that they have written to finance and commerce ministers suggesting them to take steps to check these discounts as they are leading to predatory pricing.

"We have recently met officials of the ministry, who are making the new e-commerce policy. We have urged to put certain clauses to check e-commerce firms giving huge discounts and freebies as it is damaging the trade fabric of the country," he said.

He added that e-tailers are giving discounts for the last four-five years and these were seriously damaging small retailers.

Framing of a new policy also assumes significance as rich member nations of the World Trade Organisation (WTO) are pushing to frame global norms for e-commerce trade.