DPIIT investigates e-commerce businesses for predatory pricing

By

Isabelle Crossley

Published
Feb 7, 2020

The Ministry of Commerce and Industry is currently examining allegations against several e-commerce businesses for alleged predatory pricing through its Department for Promotion of Industry and Internal Trade.

 
The DPIIT is examining e-commerce businesses to see whether they are offering excessive discounts to customers to a degree that harms the industry, Union Minister of Commerce and Industry, Piyush Goyal, told the Lok Sabha, the Press Trust of India reported.

According to the current foreign direct investment policy, foreign-owned e-commerce businesses must operate with a marketplace model that cannot influence pricing on their platforms and must maintain a level playing field. Both Flipkart and Amazon have been accused of breaking FDI regulations by several traders’ bodies.

"Representations have been received in this department [DPIIT] alleging that some e-commerce platforms are engaged in predatory pricing and are providing excessive discounts,” Goyal said in reply to a question in the Lok Sabha on February 5, the Press Trust of India reported.

“These representations are under examination."
 
The Ministry of Commerce and Industry has been repeatedly requested to investigate businesses such as Flipkart and Amazon India for alleged FDI regulations violations.

The Confederation for All India Traders has especially lobbied for such an investigation, claiming the two U.S.-owned giants are harming Indian traders through their business practices.