The Esya Centre, a think-tank that researches issues that lie at the intersection of technology and policy, has published a report titled ‘Digitalising Indian Retail: Capacity Building for a Global Context’ that recommends the adoption of state-led capacity building initiatives that facilitate the adoption of digital technologies and e-retail by Indian MSMEs.
Such an approach will also allow India to adopt a more nuanced and balanced strategy in e-commerce related negotiations at global forums like the World Trade Organisation. The report is authored by Mohit Chawdhry, a Junior Fellow at the Esya Centre.
This report, the second in the series on e-retail, highlights the importance of digital technology adoption for the growth of Indian MSMEs. Small enterprises however, it states, face hindrances in adopting digital technology and e-retail in the form of i) infrastructure deficits ii) skill development and iii) finance. Despite the existence of well-intentioned Government schemes and programmes that target these deficits, India has achieved little headway in remedying them.
This stands in contrast to the experience of other nations in the Indo-Pacific, such as Singapore and Malaysia, which have made rapid advancements in digitizing their MSMEs. The differing outcomes are particularly relevant in the current global context, where discussions on a global compact governing e-commerce, and resultantly e-retail, are nearing completion.
\India has distanced itself from these negotiations, as it feels that the unrestrained entry of large global corporations into e-retail will negatively impact its local enterprises, while these other nations are active participants in the Joint Initiative on E-Commerce.
The report links this difference in outcomes to the adoption of contrasting regulatory approaches. India, as evidenced by the draft National e-commerce policy, follows a prescriptive approach, which is focused on the creation of standards that companies ought to follow. The other nations, namely, Thailand, Malaysia, Singapore, and Myanmar, have instead adopted a development-led approach that specifically targets capacity building for their local enterprises.
A key facet of this approach is the creation of specialised and independent agencies that are tasked with the broad mandate of promoting the adoption of digital technologies. The report studies the structure of these specialised agencies to identify crucial principles that can guide the creation of a similar agency in India. These principles are i) Agencification ii) Planning and Goal Setting iii) Results based evaluation and iv) inclusive consultation.
The report uses these principles to propose the framework for an Indian e-retail Development Authority (IeRDA). It proposes, this authority should be created as an attached office of the Ministry of Electronics and Information Technology with a broad mandate and institutional autonomy.
