India's Draft E-commerce Policy: Yay! or a Nay?
The new draft policy rolled out this Saturday holds great significance for the e-commerce sector of the country. While the 41-pages Draft policy speaks volumes about data protection, analysis, regulation to the market places, encouraging entrepreneurship, regulating cross-border data flow etc, there remains a big bag full of opportunities as it is inferred that the industry stands to only gain and benefit.
The e-commerce sector which has seen a dramatic rise in India is undergoing several alterations and the draft policies bring in some new additions. The report highlights the magnitude of the e-commerce market on the global forum. The Indian B2C e-commerce valued at USD 38.5 billion in 2017 is expected to rise to USD 200 billion in 2026. The draft says that despite such dramatic rise, the Indian e-commerce sector is at a nascent stage, accounting just 3 per cent of the of the USD 860 million retail markets.
The Draft policy highlights how India is becoming a booming digital economy. It gives standpoints in aspects of data localization, data protection, storing data locally etc.
The draft highlights that data protection is a priority that cannot be neglected under any circumstances. The need to regulate cross border flow of data arises from this very spectrum. Further, the focus on setting up of more data centres will strengthen the digital infrastructure of the economy and boost the cloud computing system as well.
According to the draft, e-commerce sites or apps available for download in India must have a registered business entity in the country. This comes in the light to protect and avoid the sale of counterfeit products by way of shipping. Imposing customs and restricting the sale through resorting to a legal route will definitely filter out the counterfeits, China has been a prime example of such actions.
While this move is going to accompany massive revenue and data loss for an endeavour that is hoping to build a global e-commerce regime. It will also bring a lot of loss to the top e-commerce giants like Amazon, Flipkart as the e-commerce draft policy seeks to curb discounts offered by online market places.
Who Stands to Benefit?
The main question that seems to grapple the reader is how does the draft e-commerce policy stand to benefit the MSMEs/ Start-ups or small businesses?
The draft reassures that the transaction costs will definitely move down and in turn, reduce the financial burden off the shoulders of small businesses.
The government will be a binding force for all the activities as it is dedicated to fulfilling the “development aspirations” sans any “market failures and distortions”, the draft claims. The stakeholders have been given March 9th till the time they can loop their comments.