Traders body Confederation of All India Traders (CAIT) has criticised Washington-based industry lobby group US India Business Council (USIBC) for reportedly proposing that India should not tighten foreign direct investment (FDI) rules for e-commerce further as it could limit e-commerce firms from leveraging their scale.

“The uncalled for intervention of USIBC shows the utter desperation of US-based companies like Amazon and Walmart which are part of this lobby group, as they have understood that their sinister game of controlling and dominating e-commerce and retail trade of India will soon be over and they are trying to block initiative of DPIIT for bringing a new Press Note and e-commerce policy,” according to an official statement circulated by CAIT on Saturday.

CAIT was reacting to media reports on USIBC writing to the Indian government urging it not to make any more material restrictive changes to e-commerce investment rules.

In a letter which CAIT shot off to USIBC chief Nisha Biswal, it said that the body’s intervention was unwarranted and ran against the interest of 85 million traders of India.

The exchanges on India’s e-commerce are taking place amidst speculations that the Department for Promotion of Industry and Internal Trade (DPIIT) may come up with new FDI specifications for e-commerce putting in place checks such as restricting sellers, in which a foreign e-commerce firm holds an indirect stake, from selling on its platform.

India’s FDI rules allow foreign e-commerce companies to invest in online marketplaces to let other sellers sell their products, but they can’t sell their own wares on the platform.

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