India wants e-commerce players to be ‘fair and just’, says Piyush Goyal

A day after criticising e-commerce players for predatory pricing, Commerce Minister Piyush Goyal on Thursday said he was not against online platforms but India wanted such players to be “fair and just” in their conduct.

Speaking to reporters in the financial capital, the outspoken foreign minister said the rule of law should be upheld in letter and spirit, and made it clear that consumer preferences should not be modified by algorithms.

Echoing earlier concerns about protecting local businesses, Goyal stressed that small businesses should be given a fair chance to compete with e-commerce giants.

“We are very clear that we want to invite FDI (foreign direct investment), we want to invite technology, we want to have the best of the world and we are not at all against the internet,” Goyal said at the event.

READ MORE: Modi’s minister slams Amazon; warns e-commerce surge could cause social disruption in India

“The country always wants fair play, fairness — to the customer, fairness to the provider of goods and services, and also to give other people a fair chance to compete with such online businesses,” said the union minister, a member of parliament from Mumbai North constituency.

Goyal on Wednesday raised concerns about predatory pricing by e-commerce companies and feared the impact of their activities on small retailers in the country. He also made his concerns public, warning of “huge social disruption” due to the huge growth of the e-commerce sector.

The minister questioned Amazon’s claim of a $1 billion investment in India, saying the US retailer was not doing any great favour to the Indian economy and was merely compensating for the losses it incurred in the country.

He said their huge losses in India “smack of predatory pricing” which is not good for the country as it hits millions of small retailers.

Goyal, a chartered accountant, on Wednesday slammed e-commerce firms, questioning their business model that adversely affects small retailers in the country.

“When Amazon says we’re going to invest a billion dollars in India and we’re all celebrating, we forget the hidden story that the billions of dollars aren’t going to great services or some great investment that’s going to support the Indian economy. They had a billion-dollar loss on their balance sheet this year, they had to make up for it.

“And how this loss was incurred, they paid Rs 1,000 crores to professionals. I don’t know who these professionals are… I would like to know which chartered accountants, professionals or lawyers are getting Rs 1,000 crores, unless you are paying all the best lawyers to lock them up so that no one can fight you in the case,” the minister said.

On Thursday, he said the government wants to support online businesses and is in favor of such entities, which offer “huge benefits” such as speed and convenience.

Later, speaking to reporters, he said business activities should be based on the law of the country, both in letter and spirit.

“The algorithm should not be used to force consumer preferences. The ratings that are given on these sites should be honest,” he said.

Goyal did not name the entities but said the consumer affairs ministry had “caught” several organisations for manipulating ratings.

The government wants the e-commerce foreign direct investment (FDI) policy, which allows a business-to-business (B2B) marketplace model, to be “scrupulously followed by all foreign e-commerce companies” in accordance with the country’s laws, he said.

“We want to make sure our consumers have a choice and that business practices are fair and legal,” he added.

Meanwhile, Goyal added that he hopes to unveil a new e-commerce policy soon.

He also said any free trade agreement would be based on the “strength of fair, equitable and balanced benefits to India”.

The Minister assured that the country will ensure that any free trade agreement protects the interests of our farmers, livestock keepers, dairy farmers, fishermen, SMEs and domestic manufacturing industry and is designed in a manner that is in the best interest of India and ensures a level playing field for our traders.

“We do not make deals in haste and finalise them keeping in mind India’s interests,” Goyal said.