E-commerce giants Amazon, Walmart ask India not to make foreign investment stricter | Business Upturn

E-commerce giants Amazon, Walmart ask India not to make foreign investment stricter

With the Union Budget, only a couple of days away from being announced, global r-commerce giants Amazon and Walmart have asked India not to increase the restrictions on its foreign investment policy.

According to a letter seen by Reuters, an American lobby group which is representative of several companies including Amazon.com and Walmart has requested India not to tighten foreign investment rules for e-commerce companies again.

The last time these rules were changed was in 2018 when India revised its foreign direct investment (FDI) regulations which would prevent foreign firms from promoting and offering services and products from sellers in which they have an equity stake.

The possibility of another revising of the rules has now been put into the picture as several traders in India have accused Amazon India and Walmart’s Flipkart of having designed very intricate policies to bypass investment regulations. According to the existing rules, the foreign e-commerce companies are only permitted to perform the function of a marketplace to connect buyers and sellers; but since a while, local traders have accused the American giants of promoting only select sellers and offering deep discounts, which is hurting the business of smaller local retailers.

The companies have denied these accusations and the U.S.-India Business Council (USIBC), a part of the U.S. Chamber of Commerce, has suggested that India’s Department for Promotion of Industry and Internal Trade (DPIIT) should begin a substantive consultation with companies on e-commerce regulations before it makes any decisions.