4 years on, long-pending national retail policy still just a draft

DPIIT cites ONDC, welfare board efforts as alternatives to formal policy

The government may not go ahead with the long-pending national retail trade policy, as it has already been taking steps to address the needs and welfare of retailers, a top official said. 

“Various interventions have been taken. The Open Network for Digital Commerce (ONDC) is one of them. There’s a National Traders’ Welfare Board, and we continue to have extensive interactions with them. So, from time to time, various initiatives have been rolled out, and the government has been addressing retailers’ concerns on a regular basis,” a senior government official said. 

The Department for Promotion of Industry and Internal Trade (DPIIT) had prepared a draft national retail trade policy four years ago, focusing on promoting ease of doing business through measures such as reducing compliance burdens, enhancing access to credit, and decriminalising minor offences. 

The draft also emphasised assessing licensing requirements, implementing inspection reforms, and creating a single-window facilitation mechanism, among other proposals.  

However, the final policy is yet to see the light of day. 

In the meantime, in 2022, the government launched ONDC to promote open networks for the digital exchange of goods and services and improve visibility for sellers. The aim was to boost revenue for sellers and facilitate the onboarding of small, local businesses so they could benefit from the e-commerce boom. 

A year later, the DPIIT also set up the National Traders’ Welfare Board to suggest simplifications to laws and rules applicable to traders, reduce their compliance burden, improve access to finance, and recommend social security benefits such as insurance, pensions, and healthcare. 

Praveen Khandelwal, Member of Parliament and secretary general of the Confederation of All India Traders, said India still needs a retail trade policy, as it would empower over 80 million small traders across the country. 

“Today, traditional retailers face a host of challenges — regulatory ambiguity, lack of access to institutional credit, inadequate infrastructure, digital exclusion, and growing pressure from unregulated e-commerce practices. Despite their resilience, small traders are often left behind in the march towards modernisation,” he said, adding that when all other sectors of the economy have dedicated policies, retail trade should have one too.