CAIT reaches out to Trump against e-commerce majors

New Delhi : The Confederation of All India Traders (CAIT) on Sunday sent a memorandum to US President Donald Trump asking him to advise e-commerce majors to carry out their operations in India in line with the rules and laws.

"The Confederation of All India Traders (CAIT) today sent a memorandum on current position of e commerce in India which is greatly vitiated by e-commerce companies, majorly by US based e-commerce companies," a statement from the traders' body said. The memorandum was sent through the US Ambassador to India, Kenneth Iyan Juster.

The move comes a day ahead of Trump's first official visit to India. His two-day visit starts on Monday as his Air Force One flight will land at Ahmedabad's Sardar Vallabhbhai Patel International Airport around noon on Monday.

While calling for more closer bilateral trade between India and USA, CAIT, in its memorandum, said that the Indian government, adopting a liberal approach in facilitating global e-commerce companies to conduct their business in India, formulated a well-defined FDI policy for making investments in India which also includes the e-commerce sector but this was being violated.

"... various e-commerce companies including US based e-commerce companies have made it a habit to flout and violate the FDI policy by adopting predatory pricing, deep discounting, exclusive sale of goods, having preferential seller system and influencing the prices and thus creating an uneven level playing field which is most disadvantageous to small businesses of India," CAIT said.

Such companies have found ways to avoid explicit provisions of FDI policy thereby creating massive distortion and disruption not only in e-commerce but also in retail trade of India, it added.

The organisation has time and again written to and met Commerce Minister Piyush Goyal, among others, to register their protest against what it describes as deep discounting and unfair means by both the online platforms, which has impacted the offline traders.

The traders body had staged protests across India during the visit of Amazon CEO Jeff Bezos to India last month.

Following appeals by the traders' body, the Competition Commission of India (CCI) in January ordered an enquiry into the operations of both Amazon and Flipkart on multiple counts, including deep discounts and exclusive tie-ups with preferred sellers.

However, following a writ petition by Amazon at the Karnataka High Court, the court on February 14 ordered a stay on the anti-trust probe. The High Court was of the view that the ongoing investigation by the Enforcement Directorate (ED) should be completed first. Last year, the ED initiated insvestigation against both Amazon and Flipkart for alleged violation of the foreign exchange law.

Further, days after the stay order, Walmart-backed Flipkart on Friday also moved the Karnataka High Court urging it to set aside the probe. In its writ petition, Flipkart Internet Private Ltd said that although the High Court has ordered a stay on the investigation, the probe order of the CCI "deserves to be set aside".

CAIT is likely to file a petition against stay order in the coming week at the Supreme Court, a CAIT office-bearer told IANS.