The Indian government may revisit plans to curb e-commerce discounts: Report

  • The Indian government is reportedly planning to revisit plans to crack down on the huge discounts and cashback offers offered by e-commerce companies
  • A proposed policy will include online retail giants as well as smaller e-retailers like also food delivery apps.
  • The plan is aimed at discouraging ‘predatory pricing’ that impacts traditional retailers.
Concerned by ‘predatory pricing,’ the Indian government is reportedly considering a policy to crack down on the strategy of ‘deep discounting’ prevalent among the country’s e-commerce players, the Times of India reported.

The proposed regulation will regulate the pricing strategy of e-commerce giants like Flipkart, Amazon, Paytm Mall but also cover food delivery apps.

According to the plan, the policy is aimed at keeping a close check on ‘predatory pricing’ that could potentially disrupt traditional retailers.

Online retailers in India have been in stiff competition and many have chosen to offer aggressive steep discounts as a way to attract customers. The e-commerce market is expected to grow to $200 billion in the coming ten years.

However, government concerns may be overblown as e-commerce penetration in India is somewhat limited compared to other markets like China and the US.

As of now, the Indian government doesn’t regulate e-commerce companies. Earlier this year, the government mooted a a sunset clause to regulate the pricing strategy of ‘deep discounts’ but the draft wasn’t transformed into policy, according to reports.

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