Trade and Industry Minister Piyush Goyal said today that the government is not concerned about flash sales on online platforms, but predatory pricing and other defrauding methods used by e-retailers to limit consumer choice.
He also said that consumers who purchase goods on the e-marketplace platform to avail the benefits of flash sales are often redirected to entities favored or promoted by the online retailer, which is cheating and contrary with the rules on foreign direct investment.
“Why should I complain if someone wants to give a discount… Consumers get a good deal, we don’t have a problem,” Piyush Goyal, who also holds the portfolio of the Ministry of Consumer Affairs, said at an event here.
He said there are two objections: one is tracking predatory prices by dumping goods, and the other is methods of limiting consumer choices.
“We are only trying to stop that deception through the e-commerce policy that we come out with,” said the minister.
Citing China, he said dumping goods at “very” low prices kills domestic production and forces consumers to buy goods at high prices.
“Today, consumers can get excited (about flash sales), but as a policy maker, I have to look at a long-term good for the Indian consumer and that predatory pricing, or such methods of cheating the public with choice, is what we are against,” added Piyush Goyal.
He said foreign e-commerce players have deep pockets and they have no problem investing several billion dollars in India and recording “huge” losses.
They are only concerned with attracting customers at any cost and price, he said.
He reiterated that the country’s FDI laws must be respected by the e-commerce players and the marketplace must function as a marketplace.
The marketplace players can sell products as their own branded platform, “we have no problem, that’s perfectly possible and allowed, but you can’t combine the marketplace model with your single-brand shopping model,” he added.
Furthermore, Piyush Goyal said that in developed economies, mom-and-pop stores are closed because of e-commerce giants.
The government stands with small retailers to the end to protect them and give them a bright future, he added.
“Indian or foreign, I call on everyone to support this effort to protect our small retailers,” the minister said.
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