Distributor body seeks govt intervention over Amazon, Flipkart's qcom entry

AICPDF has urged the Centre to examine whether Amazon and Flipkart's quick commerce models comply with FDI rules and their impact on India's retail ecosystem

The distributors' body has written to the Ministry of Commerce & Industry seeking intervention over the rapid expansion of quick commerce in India and the proposed entry of foreign-funded e-commerce companies such as Amazon and Flipkart into the sector.

 

In its letter, the All India Consumer Products Distributors Federation (AICPDF) sought clarification on the amendment, clarification, or approval permitting foreign-funded marketplace e-commerce entities such as Amazon and Flipkart to operate quick commerce through warehouses or dark stores.

 

It also asked whether such entities are permitted under the existing foreign direct investment (FDI) policy to directly or indirectly own, control, or manage inventory through dark stores or fulfilment centres.

   

The move comes as both Amazon and Flipkart recently entered the quick commerce space.

 

The letter also asked whether their operational models comply with the FDI policy for marketplace e-commerce entities.

 

“Refer appropriate issues, wherever warranted, to the competent regulatory authorities, including the Competition Commission of India, for examination of competition-related concerns, and to the Central Consumer Protection Authority for examination of consumer protection issues,” the letter stated.

 

AICPDF has also called for strict enforcement of the FDI policy and all applicable laws governing e-commerce and foreign investment.

 

The letter also urged the government to constitute a high-level committee comprising the Department for Promotion of Industry and Internal Trade (DPIIT), the Ministry of Commerce & Industry, the Ministry of Finance, the Competition Commission of India, the Central Consumer Protection Authority, trade associations, distributors, and consumer representatives to comprehensively study the long-term impact of quick commerce on competition, employment, investment, consumer welfare, and India's retail ecosystem.

 

“Take such policy and regulatory measures as may be necessary to preserve a fair, transparent, and level playing field while protecting the livelihoods of approximately 1.4 crore retailers, 4.5 lakh distributors, and the several crore citizens directly and indirectly dependent upon India's retail trade,” the letter added.

 

The distributors' body said there is concern within the retail and distributor fraternity and stated that a substantial number of retailers have discontinued operations in recent years due to increasing pressure from digital commerce platforms.

 

“If foreign-funded marketplace companies are permitted to enter quick commerce using inventory-controlled models, the impact on employment, entrepreneurship, and small businesses could be devastating,” the letter said.

 

It said the practice of deep discounting, predatory pricing, and aggressive promotional campaigns has disrupted the traditional retail sector.

 

“Such pricing practices create an uneven playing field for neighbourhood retailers and distributors who cannot compete with sustained below-cost selling and heavily subsidised discounts,” AICPDF said in its letter.