CAIT calls for liberation from monopolies of Amazon & Flipkart

New Delhi, Jun 17 (KNN) The Confederation of All India Traders (CAIT) has urged Union Commerce Minister Piyush Goyal to liberate e-commerce landscape of the country from the vicious clutches of Amazon, Flipkart & others which are hell bent in monopolising e-commerce and retail trade with their unethical business practices.

The CAIT came down heavily on some of the recent statements made by Amazon and said that it is nothing but a planned strategy of Amazon to showcase it as a saviour of traders of the Country in the same fashion in which the India Company portrayed itself as a true friend of India.

''It is a fallacy and a bid to divert the attention of the people from various charges levelled against it. Let companies like Amazon and Flipkart understand that " India is not for sale" and they should desist from their sinister designs of controlling and monopolising e-commerce and retail trade of India,'' it added.

CAIT National President B C Bhartia & Secretary General Praveen Khandelwal said that the manner in which these companies are violating FDI policy and the related laws and rules, it looks like that come what may, they have an objective of controlling and dominating e-commerce business to their own advantages and equally they are least bothered about kind of devastation or closure of shops that happens in various states of the country.

''It is nothing short of economic terrorism,'' they said.

They further said that in a recent article in one of the prime print media, the Amazon has claimed to digitized 2.5 million MSMEs in India, effectuated cumulative e-commerce exports, by over 70,000 MSMEs, via Amazon Global Selling to the tune of 3 billion dollars and created 300,000 jobs since January 2020.

Terming these claims as unfounded and devoid of any credibility because the larger industry paints a different picture, the duo said that Amazon’s constant claims to helping and assisting MSMEs is a falsehood because while Amazon’s marketplace in India reported a 42 per cent jump in its revenue at Rs 11,028 Crores in 2020 itself, the financial health of MSMEs has only deteriorated between 2020-21.

According to a Local Circles report, 59 per cent of startups and MSMEs in retail may shut shop, sell off or scale down operations in 2021. It further states that a mere 22 per cent of the startups have more than 3 months runaway (funds) while 41 per cent are out of funds or have less than 1 month’s funds left.

Both the trade leaders further said that it is also pertinent to note that while Amazon boasts of adding nearly 250,000 new sellers since January 2020 and has clocked e-commerce exports for MSMEs to the tune of 3 billion dollars, small and medium traders and industry associations have been increasingly rallying against the activities of Amazon. In the aftermath of Amazon’s Sambhav event, 600,000 small and medium retailers organized “Asambhav” to showcase how Amazon’s business practices are illegal and monopolistic.

''It is also surprising that Amazon claims to have added 300,000 new jobs directly and indirectly since January 2020 while recent studies by multiple sources have painted a dismal picture. The Centre for Monitoring of Indian Economy (CMIE) has found that the second wave rendered more than 1 crore Indians jobless and resulted in a 97 per cent decline in household income with a 12 per cent unemployment rate in May 2021,'' CAIT said.

Both the leaders said that Amazon’s insistence on showcasing absolute numbers and its selective interpretation of those numbers must be taken cautiously. It is most important to read these numbers in the context of Amazon’s exploitative and predatory business practices. So, while Amazon claims to have added 300,000 new jobs since January 2020, what is more important is to investigate the kind of jobs that it has created.

''It becomes even more important to read its job creation numbers in the context of the number of small and medium businesses (SMBs), run by small Indian retail entrepreneurs that have been forced out of the business courtesy Amazon’s deep discounting and predatory pricing through capital dumping,'' they asserted.

In the same way, Amazon’s claims of having added 250,000 new sellers since January 2020 and having clocked e-commerce exports for MSMEs to the tune of 3 billion dollars must be seen in the context of its well-known practice of keeping ‘preferred sellers’ who are a set of closely-knit sellers in which Amazon has an equity or economic participation, who act as sellers on the marketplace platform.

''Therefore, more than the number of MSMEs added, it is imperative to understand and note the per cent of revenue that is generated by these newly added MSMEs and whether there exists a level playing field for them. Amazon’s insistence on a selective reading of the numbers is solely for the purpose of deceiving and misleading customers and the industry in general,'' they said.

In view of the above, the Government should act fast before foreign companies like Amazon and Flipkart are able to completely destroy and devastate both e-commerce and retail trade of India, the leaders concluded.