Rapid growth of e-comm matter of concern, not source of pride: Piyush Goyal

Union Commerce Minister Piyush Goyal raised concerns over the rapid growth of e-commerce in India, questions predatory pricing strategies employed by online retail giants

Union Commerce Minister Piyush Goyal voiced his concerns on Wednesday about the rapid expansion of e-commerce in India, calling it a “matter of concern” rather than a source of pride. While speaking at an event for the launch of a report on the net impact of e-commerce on employment and consumer welfare, Goyal emphasised the potential social disruptions that could arise if the sector's growth is not carefully managed, according to media reports.

Goyal acknowledged the role that e-commerce plays in the Indian economy but stressed the need for a more organised approach to its expansion. He questioned the impact of predatory pricing strategies employed by some e-commerce giants, such as Amazon, which he suggested could harm the broader economy rather than contribute to it.

“When Amazon says we are going to invest a billion dollars in India and we celebrate, we forget the underlying story that this billion dollars is not coming for any great service or investment to support the Indian economy,” Goyal said. He pointed out that such investments might be more about covering operational losses than truly benefiting the country’s economy.

The minister also voiced concern over the decline of small retailers, particularly in the face of competition from large e-commerce platforms and retailers. He pointed at the disappearance of many small mobile phone stores, questioning if only big brands like Apple should dominate the market.

Goyal warned against causing “huge social disruption” by allowing e-commerce to capture a significant portion of the market without considering its broader impacts. He emphasised the importance of ensuring that technology and innovation benefit a larger section of society and do not lead to the erosion of small businesses.

While the minister clarified that he is not against the e-commerce industry, he called for a careful review of its role in India’s economy, advocating for growth that is citizen-centric and socially responsible. He urged stakeholders to consider the long-term consequences of e-commerce expansion and to ensure that it happens in an orderly and balanced manner.