New Delhi: Union Commerce Minister Piyush Goyal has raised serious concerns over e-commerce giant Amazon’s business practices in India, questioning the legitimacy of its operations and the broader impact of e-commerce on local retailers. Speaking at an event in Delhi, Goyal pointed out that Amazon, as an e-commerce platform, is legally barred from direct business-to-consumer (B2C) transactions.
“They are an e-commerce platform, which legally cannot do business-to-consumer. They create entities where Indians contribute to making those entities, sadly. Then they get caught, so they start closing down those entities,” Goyal stated.
The minister also criticized Amazon’s widely publicized billion-dollar investments, suggesting they should not be celebrated. “The investment is not coming in for any great service or investment to support the Indian economy. They made a billion-dollar loss in their balance sheet, and they have to fill in that loss,” Goyal argued.
Further intensifying his critique, Goyal raised alarms about the company’s business practices, particularly its pricing strategies. “If you make a 6,000 crore loss in 1 year, does that not smell like predatory pricing to any of you?” he questioned, pointing to concerns about Amazon’s impact on market competition.
Goyal’s remarks extended beyond Amazon to the broader e-commerce sector, warning of the potential social disruption of millions of small retailers and shopowners. He highlighted the vulnerability of traditional retail stores, which rely on a small percentage of high-margin products that are increasingly being targeted by e-commerce giants.
“A retail store has 5-10% of products that make a good profit. E-commerce is edging and wedging into these high-margin products. Imagine what happens to 10 million retail stores in our cities,” Goyal emphasized.
The minister also called for an assessment of the impact of e-commerce and cloud kitchens on offline businesses, especially, pharmacies, mobile phone retailers, and restaurants.
