The government has ordered the Compliance Directorate and Reserve Bank of India to take appropriate action against Amazon and Walmart-owned-Flipkart in a significant development related to the war between e-commerce giants and Indian traders.
The Centre has been well aware of the numerous complaints made by the Confederation of All India Traders (CAIT) about these companies’ apparent breach of the FDI Policy and Foreign Exchange Management Act, 1999 (FEMA).
In the recent past, CAIT has sent several complaints to Union Trade Minister Piyush Goyal against Amazon and Walmart-owned Flipkart.
In its letter released in December, the Department of Industry Promotion and Internal Trade (DPIIT) of the Ministry of Commerce asked both ED and RBI to take the requisite action against the major e-commerce companies.
CAIT alleged that DPIIT submitted four of its grievances, including a violation of FDI policy in an agreement between Flipkart and Aditya Birla Group, a violation of FDI policy related to FDI in manufacturing used by various e-commerce companies for multi-brand retailing, a violation by Amazon of FEMA and its rules and a clear violation by Amazon and Flipkart of FEMA and FDI policy and clarification of FEMA and FDI policy.
The body said that “traders across country will observe 2021 as ‘Bhartiya Vyapaar Samman Varsh’ and all efforts will be made to clean the e-commerce landscape and an era of manipulations, mal-practices, and exploitation will come to end.”