CAIT protest against the e-commerce companies, starting from November 13

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The protest against the e-commerce companies continues because of the anti-competitive practices and to join the race now, the Confederation of All India Traders (CAIT) has stepped out to fight with these companies including Flipkart, Amazon and other similar platforms.

CAIT has launched a nationwide agitation against these companies as it is alleged that they are violating the law and the FDI policy.

 The claim of nationwide protest was claimed by trade leaders in the National Traders Conference which was held on Sunday in New Delhi and was organised by CAIT. This nationwide protest will start from November 13 and will end on January 10, 2020. Other trade associations who will take part in the protest are:

  1. Federation of Hardware Manufacturers & Traders Association
  2. Drug Dealers Association of India
  3. All India Consumer Products Distributors Federation
  4. Federation of All India Aluminium Utensils Manufacturers
  5. All India Association of Electronics Merchants Association
  6. All India Mobile Retailers Association
  7. Toys Association of India
  8. Federation of Electrical Goods & Appliances Association

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CAIT, along with many other Trade unions is in argument and agitation with the e-commerce platform from last many years over the issue of giving substantial discounts, unfair trade practices and predatory pricing. The traders allege that the e-commerce company have a good hold in the inventory through sellers controlled by them.

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The objective behind the protest is to protect the local retailers and other market players from the attack of these companies. It adds, “whose malpractices including predatory pricing and deep discounting will prove to be fatal for the retail trade of India.”

These traders have also approached PM Narendra Modi and Piyush Goyal, Commerce Minister to look into the matter on an urgent basis and ensure that law and policy are same for all and is followed in every sense. There should not be any inequality in its implementation.

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Praveen Khandelwal, who is a general secretary of CAIT, said he wants to know how these companies can survive when every year their business is incurring a huge loss. He added, “It is deeply regretted that in spite of making complaints, the CAIT Government has not taken any action against them. The resolution further said that the Government should immediately order for closure of their e-commerce portal pending an investigation by an independent Authority in a time-bound manner,”.

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 Additionally, the traders also want that the Government release their draft National E-commerce Policy and the demand of traders being consulted before the draft is rolled out in public. Further, the traders want to have a regulatory body or an E-commerce CAIT Ombudsman that will regulate the e-commerce companies and will have the power to take immediate action against them when found to be working against the policy and law or when seen to be involved in any unethical and unfair business practices.

Violation of the FDI Policy

FDI funds the online marketplace in India, and it allows the company to sell its products only to the third-party sellers. It does not permit these companies to hold any inventory/stock or sell their goods to the customers.

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As per the FDI norms, if an online marketplace sources more than 25% of merchandise from any entity or seller related to it then in such cases that seller will be seen to be controlled by the marketplace. 

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As per the recent report, it is said that Flipkart is now acting more as a retailer than an online marketplace. As per the report of FY2019, Flipkart bought Rs 39,514 crore worth goods and then further sold it, which means it has now become more of a retailer than being a pure marketplace. This issue of selling their products is the primary concern of CAIT.

Plan of Action

In this two-month action, traders will submit a report to all MPs of Rajya Sabha and Lok Sabha. They will demand from them to put up this issue in Parliament and pressurise the Government to take the needful steps against these CAIT e-commerce companies. This protest which marks as the CAIT first phase of the trader’s agitation will end in the three-day National Traders Convention which is to be held from January 6 to January 8, 2020, at New Delhi and will be attended by trade leaders of about 20,000 trade associations from all over the country.

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