Comment on the prevalence of anti-competitive practices in the Indian e-commerce sector.

The boom in the e-commerce sector has made life more convenient and easier. It has radically changed various aspects of our everyday lives ranging across traveling, entertainment, education, shopping, communication and even getting food.

E-commerce:

  • E-commerce is the buying and selling of goods and services, or the transmitting of funds or data, over an electronic network, primarily the Internet
  • It comprises products, both digital and physical, and services traded on digital and electronic networks.

Benefits of e-commerce:

  • Round the clock availability of virtual stores.
  • Flexibility.
  • Increased and fast accessibility.
  • Wider range of options.
  • No geographical barrier.
  • Lower costs making it more competitive.

Anti-competitive practices of e-commerce:

  • E-commerce giants have caused significant damage to small and medium online businesses by using predatory pricing strategies and huge discounts and cashbacks etc.
  • The giant e-commerce companies deliberately reduce the prices to loss-making levels to acquire more customers and eliminate smaller players from the market.
  • In the long run, it reduces competition and in turn will reduce the bargaining power of consumers, while subjecting them to arbitrariness of monopolistic conduct.

Way Forward:

  • Democratization of e-commerce space by promoting government-backed Open Network for Digital Commerce (ONDC).
  • Appointment of a Compliance Officer and a nodal contact person.
  • Strong grievance redressal mechanism.
  • Restriction on unfair trade practices and clear-cut definition of what constitutes Unfair Trade Practices.

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