New Delhi (Sputnik): E-commerce is the fastest-growing market in India and has become a major draw among firms worldwide. With deeper penetration of the Internet and smartphone accessibility, the country is eyeing $200 billion in growth in the segment by 2026.
Drawing the Indian government’s attention to the business model of e-commerce companies and the fact that they are operating in India despite incurring huge losses, the Confederation of All India Traders (CAIT), an umbrella body of traders, urged the Indian government on Friday to launch a probe into the matter.
Arguing that despite experiencing losses, e-commerce firms are able to not only operate, but offer deep discounts, National Secretary General of the trade body Praveen Khandelwal requested that Minister for Commerce and Industry Piyush Goyal roll out a robust e-commerce policy for regulation.
Substantiating its case, the CAIT presented figures that highlighted heavy losses to the company. While the giant e-commerce firm Amazon operated at a loss of $800 million (Rs. 5,685 crore) in 2019, its rival Flipkart incurred $228 million (Rs. 1,625 crore) in losses the same year.
Major India-based food delivery platform Swiggy had $332 million (Rs. 2,363 crore) in losses and its competitor suffered a loss of $293 million (Rs. 2,087 crore).
Similarly, figures for ride-hailing apps like Ola lost $365 million and other e-commerce firms were also shared.
CAIT further argued that not only their business model, but the investments received and their disbursal should also be thoroughly probed. These, it said, included, avoidance of GST and income tax revenue.
Urging Minister Piyush Goyal to maintain a healthy e-commerce ecosystem in the country by removing “anomalies”, Khandelwal demanded that a regulatory authority or an ombudsman for e-commerce be set up.
The Indian e-commerce market grew at $48.5 billion as of 2018. With almost 560.01 million Internet users in India, Online retail sales in India have grown by 31 percent to $32.70 billion lately, making it a lucrative destination for e-commerce firms.