50000 Mobile Shops Shut due to Illegal Practices by E-Commerce Firms: CAIT

More than 50,000 mobile stores across India have had to shut shop in the last few years due to illegal practices of foreign e-commerce firms, Confederation of All India Traders (CAIT) has alleged.

In order to drive customers away from stores, it was further stated that e-commerce platforms, banks, and mobile brands engage in anti-competitive behaviour such as offering cashback, steep discounts, predatory pricing, and loss funding.

The Trader’s Body claims that there is a unholy connection between e-commerce platforms, banks, and mobile phone brands, pointing out that while 8% of mobile phone sales worldwide are made through e-commerce, this percentage is much higher in India at 58% as a result of such practices.

“We have repeatedly asked the government to look into the situation. We request that the authorities look into the unfair and prohibited behaviour of this unholy nexus “said CAIT secretary general Praveen Khandelwal.

Additionally, CAIT alleged that some e-commerce sites buy exclusive deals on mobile phones from major brands before flooding the offline market with their stock. It went on to say that some online retailers are even exporting these stocks acquired through special agreements while claiming GST input tax credits for doing so.

“If this continues, there will come a time when all small retailers in the nation will have to shut down their shop. These e-commerce companies are the contemporary equivalent of the East India Company, and their ultimate goal is to monopolise the entire Indian market through deceptive means “Khandelwal expressed.

“Naturally, we acknowledge that anyone has the right to conduct business in this nation. However, it is inconceivable that foreign e-commerce players openly break all laws while local business owners are frequently stopped by law enforcement for the smallest infractions” he added.

The trade association stated that it intended to meet with Union Ministers Piyush Goyal and Nirmala Sitharaman to discuss the problems.

It also threatened to demonstrate if its demands—which included the creation of an e-commerce regulatory body, the implementation of FDI laws, and a comprehensive e-commerce policy—were not met.