Offline retailers write to MPs opposing extension of February 1 deadline

As the February 1 deadline for online marketplaces to comply with changes in the FDI guidelines approaches, offline retailers are keeping up the pressure on the government, urging it to not give into any requests for an extension by Amazon and Flipkart.

The All India Mobile Retailers Association (AIMRA) which counts 25,000 mobile retailer across the country as its members, has now written to the members of Lok Sabha and Rajya Sabha, accusing Amazon India and Flipkart of indulging in unethical and illegal practices. ET has a copy of the letter.

The grouping had earlier written to the Department of Industrial Policy and Promotion (DIPP) and commerce minister Suresh Prabhu at an earlier date.


ET reported on January 28 that smaller e-commerce Snapdeal, ShopClues, online social commerce startups like Shop 101, and online-only brands, have come together to oppose any deadline extension for the two web retailers.

Changes to the FDI guidelines notified by the government on December 26, 2018, restrict marketplaces such as Flipkart and Amazon from selling products from sellers in which they have an equity interest. It also disallowed marketplaces from entering into exclusive partnerships with brands. Both Flipkart and Amazon have written to the government asking for extensions ranging from four to six months, to comply with the new rules.

Smartphones still drive the biggest chunk of sales on e-commerce marketplaces, with analysts estimates that around 40% of all devices sold in India now happens online. AIMRA pegs that number to be higher, claiming 56% of all mobiles sold in India happens online.

The body claims Flipkart and Amazon have eroded their sales by entering into exclusive partnerships with brands such as Xiaomi, OnePlus and Samsung. Moreover, AIMRA claims that the discounts offered by these players to incentivise buyers and grow their market share has adversely affected small offline retailers.