Wednesday, October 19, 2022

Didn’t Stop The Cheap Online Shopping? Finance Department Support For E-Commerce

Some ministries were trying to control India's fast-growing online business sector, Finance Department support for eCommerce
Didn’t Stop The Cheap Online Shopping? Finance Department Support For E-Commerce
Didn’t Stop The Cheap Online Shopping? Finance Department Support For E-Commerce

However, Reuters reports that they have received some documents, including from the Ministry of Finance. The Ministry of Finance has stated that some of the laws that are being prepared against online businesses are 'excessive' and have no financial rationale. This is a large sector that includes Indian companies from US companies Amazon and Walmart to Reliance and Tata. 

The value of the country's online business sector is estimated to reach $ 188 billion by 2025.

Will the Prime Minister try to solve the problem directly?

At the same time, he says he is not sure how the Treasury's objections will be treated. There are 12 such posts out there. He says the online business community is hopeful that they will be considered by those in key positions under Prime Minister Narendra Modi. Suhan Mukherjee, the managing partner of India PLR Chambers, said a review of the policies would be possible as the finance ministry has expressed such concerns.

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Opposition to the Tata Group The Ministry of Consumer Affairs has shocked the e-commerce sector by issuing proposals to curb flash sales of online sellers. He said the relationship between online websites and their merchants would be scrutinized. 

But that was not to say that it would be implemented. It was said that all the strict rules were based on the complaints of the shopkeepers. But the Tata Group, which has a turnover of over $ 1 billion, had already come out against it. It was a time when they too were planning to enter the online business world on a massive scale.

Excessive intervention?

According to Reuters, there is opposition to the new rules from the Department of Finance, the Department of Corporate Affairs, and the Judicial Commission. The purpose of the new laws is to protect consumers. However, opposition from various departments has pointed out that they go far beyond all this and lack clarity.

The memo, issued by the finance ministry on August 31, said it was an "excessive intervention" and would create problems for a sector that would create more jobs and generate tax revenue.

Do not paralyze the emerging area

Failure to do business easily in a rising sunrise sector can lead to a variety of limitations. A three-page memo suggests that care should be taken to ensure that not all new rules interfere. 

At the same time, a spokesman for the Ministry of Consumer Affairs said that these proposals and discussions between various government departments show that there is a healthy and noise decision-making process in India's democracy.

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Opposition to the Judicial Commission

Rajiv Kumar, the vice-chairman of the Judicial Commission, had also lodged a protest with Commerce and Consumer Affairs Minister Piyush Goel. He said the new rules would affect small businesses and could be interpreted as having unpredictability and instability in policymaking. 

The arguments of the Justice Commission and the Department of Finance are similar to those of those in the online business sector, and why even the US government. Foreign companies have also complained that India is rapidly changing its online trade policies. Meanwhile, Minister Goel and shopkeepers have taken a stand against it. The Department of Consumer Affairs claims that there is widespread hacking and unfair trading practices in the online sector. Of several states,

Opposition from multiple ministries

At the same time, the proposed policies have invited opposition from multiple ministries. One of the new rules is that online retailers should not abuse their dominance. However, the Ministry of Corporate Affairs came out against it. The ministry said the provision was unnecessary and excessive. The ministry's position is that it should deal with the anti-trust sector. At the same time, most of the opposition has come from the finance ministry. 

There are 12 objections from this section. One of the most important of these is that e-commerce companies are also responsible for the mistakes made by sellers who sell through online websites. Discounting is a common trading method only Amazon and Flipkart are both marketplaces. Anyone can sell goods through these. 

The Department of Finance opposes the proposed law, which makes Amazon and Flipkart responsible for the problems caused by such sellers. The Finance Department also opposes the claim of 'not giving too many discounts'. The ministry points out that people enjoy discounts offered by websites like Amazon during the festive seasons and so on. Discounting is just a common business practice. The Ministry of Finance points out that the proposed proposal against this is not financially rational.

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