Amazon’s operations in India should be suspended until an investigation into the company is completed, the All India Mobile Retailers Association (AIMRA), a trade union representing more than 100,000 mobile phone retailers in India said. “Companies like Amazon and Flipkart, along with Chinese mobile brands have colluded to erode the local economy and killed the small retail businesses,” it said in a letter to Prime Minister Narendra Modi.
Before this, the Confederation of All India Traders, one of Amazon and Flipkart’s biggest critics in the country, has also called for a week-long ban on Amazon.
There should also be a policy to ensure that e-commerce companies have no shares in their preferred sellers, and to make sure that goods are allowed to be sold by other sellers, and not just the preferred ones on these platforms, the organisation wrote in the letter. The organisation said that mobile phone makers have exclusive tie-ups with a handful of these preferred sellers, and all stocks are given to these sellers, in order to show the e-commerce company’s non-involvement in trade. MediaNama has seen a copy of the letter.
AIMRA’s letter came in the backdrop of a Reuters report which showed that a handful of sellers, such as Cloudtail and Appario, accounted for more than 60% of Amazon’s sales in India. The report revealed how Amazon used legal manoeuvres to sidestep Indian regulations aimed at curbing deep discounting and limiting FDI. Commerce Minister Piyush Goyal had earlier said that Amazon, Flipkart, and other e-commerce companies are currently being investigated.
“These online companies came into the Indian Market with claims to support the retail economy, and instead today, have eliminated the local retail market,” the organisation said in the letter. “They have colluded with brands by showing lucrative figures and luring customers in the name of unethical discounts the same way that the East India Company functioned several decades ago, to seize control of our country as history has witnessed.”
Limit daily sales of a seller: E-commerce companies should not allow any seller to sell more than Rs 500,000 worth of goods per day, the organisation said. “We have 7 crore traders in India, whereas Amazon shows only 4 lakhs out of which the top 35 sellers are doing 80% businesses. Which is why it is imperative to curtail sales of each seller at 5 lakh to put an end to the fraudulent ways of all e-commerce businesses,” it added.
Samsung, Xiaomi, OnePlus etc. have ‘killed’ the offline market: Companies like Xiaomi, Oneplus, Realme, and Samsung are giving preferential treatment to certain sellers by supplying 90% of their new products to e-commerce and deliberately diverting customers to e-commerce sites, AIMRA said. “These companies are working like a cartel,” it added.
Tie-ups between e-commerce and banks ‘damaged’ retail business: E-commerce companies have roped in banks to offer 10% instant cash back on purchases, while similar offers are not present with offline retailers, thus, damaging their business, AIMRA alleged. “This inequality restricts customers /diverts customers towards online shopping. It is a clear collusion between banks and the e-com companies.,” it added.
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