Confederation of All India Traders (CAIT) Seeks Ban on Amazon India

The Confederation of All India Traders has urged the government to ban the e-commerce giant Amazon's Indian platform, after a report by Reuters revealed that it has been giving preferential treatment to a certain group of big sellers, largely benefitting them, harming the business of small Indian retailers, reports RHEA BINOY.

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ON Wednesday, a group of leading Indian retailers urged the government to ban local operations of Amazon.com Inc, after a report by Reuters which said that the US e-commerce giant has given preferential treatment to a small group of sellers for over the years on its Indian platform and used them to fuel the country's strict foreign investment regulations.

The report by Reuters, which is based on internal Amazon documents dated between 2012 and 2019, provided an inside look at how Amazon adjusted its corporate structures each time the government imposed new restrictions aimed at protecting small traders.

According to Reuters, the Confederation of All India Traders (CAIT) in a statement said, "the shocking revelations" in the Reuters story are "sufficient enough to immediately ban operations of Amazon in India." The CAIT says it represents 80 million retail stores in India – high that it is "important and a burning issue", it has called an "order for a ban on operations of Amazon in India."

The Amazon documents reviewed by Reuters revealed the e-commerce company helped a small number of sellers in India by giving them discounts on fees and helped one cut special deals with big tech manufacturers such as Apple Inc.

The documents, also revealed that the Amazon Inc. employees prepared a draft note for the senior Amazon.com Inc executive Jay Carney, in early 2019. As Carney was scheduled to talk with India's Ambassador to the United States in Washington, D.C, he was told to highlight the fact that Amazon had committed more than $5.5 billion in investment in India, and how it provided an online platform for 4 lakh plus Indian sellers, but he was cautioned not to reveal that some 33 Amazon sellers accounted for about a third of the value of all goods sold on the company's website. That information, the note advised was to be deemed as "sensitive/not for disclosure."

Other documents revealed that two more sellers on the e-commerce giant's Indian platform – merchants in which Amazon had indirect equity stakes accounted for around 35% of the platform's sales revenue in early 2019.

Indian retailers have long alleged that Amazon's platform largely benefits a few big sellers and engages in pricing that harms their business. The e-commerce giant has been facing scrutiny by Indian regulators, which could deepen the risks for the company in one of its key growth markets. The e-commerce giant is under investigation by India's Enforcement Directorate, which has been investigating the company for the possible violation of the foreign investment rules.

Amazon India News retweeted the Reuters report, saying it is "unsubstantiated, incomplete and factually incorrect," without going into any specifics. It added, "Amazon remains compliant with Indian laws."

Amazon India News on Twitter said, "In last several years, there have been a number of changes in regulations; Amazon has on each occasion taken rapid action to ensure compliance. The story, therefore, seems to have outdated information and does not show any non-compliance."

Indian retailers have long alleged that Amazon's platform largely benefits a few big sellers and engages in pricing that harms their business. The e-commerce giant has been facing scrutiny by Indian regulators, which could deepen the risks for the company in one of its key growth markets. The e-commerce giant is under investigation by India's Enforcement Directorate, which has been investigating the company for the possible violation of the foreign investment rules.

In a written response to the Reuters story, Amazon said, "it does not give preferential treatment to any seller on its marketplace," and that it "treats all sellers in a fair transparent, and non-discriminatory manner, with each seller responsible for independently determining prices and managing their inventory."

According to a report by The Hindu, CAIT has assured that they will raise this issue in a bigger way and that the Reuters report "vindicates the stand and arguments".

(Rhea Binoy is a journalism student at the Symbiosis Institute of Media and Communication, Pune, and is an intern with The Leaflet.)