The government shocked the e-commerce sector in India on Thursday with policy changes which placed strict prohibitions on the online retailers. The new e-commerce policy forbids e-tailers from holding exclusive sales, offering hefty discounts and forces them to rethink their cashback terms, among other things.
To this body blow from the government, Walmart-owned Flipkart has responded by assessing the impact on the industry and listing the promises online retail sector holds for the Indian economy.
"Government policy changes will have long-term implications for the evolution of the promising sector and whole ecosystem. It is important that a broad market-driven framework through right consultative process be put in place in order to drive the industry forward," Flipkart said in response to the new e-commerce policy.
In a statement released today, Flipkart said that the e-commerce industry has revolutionised the way consumers connect with sellers and local manufacturers, providing tremendous value to both parties and to the country.
"The e-commerce ecosystem created innovations in MSME manufacturing, supply chain, warehousing, packaging and digital payments, and has created thousands of jobs already. This is just a start, the industry is set to be a major growth driver for the Indian economy and create millions of jobs in the future," Flipkart stated.
Government tightened the norms for e-commerce players on grounds of protecting the domestic retailers from impact of deep discounts and cashbacks offered by the online retailers. The move is also meant to give the brick and mortar businesses a shot in the arm.
The policy, however, will affect major online sellers like Flipkart and Amazon, and the middle-class customers in the long run, who have been the biggest beneficiaries of the discounts and cashbacks.
Edited by Vivek Punj