At a time when the country needs to put in place a more flexible ecosystem to attract foreign investments to reach the target of $5-trillion economy, Union Commerce Minister Piyush Goyal’s flippant remarks on Amazon have not gone down well with the investor community. The minister has made light of the global e-commerce giant’s plans to make $1 billion investment in the country and said the American company was not doing any favour to India by this announcement. Such hostile approach is bound to scare away potential investors. This comes against the backdrop of a new set of regulations for the global e-commerce players that is widely seen as restrictive. The BJP leadership is apparently cut up with Amazon CEO Jeff Bezos because of unduly critical coverage of India’s developments by ‘Washington Post’, a publication owned by him. Soon after the BJP secured a second term, the daily commented in its editorial that Modi’s win did not bode well for India’s democracy. Similarly, it has been critical of the NDA government’s decisions like abrogation of Article 370 in Jammu & Kashmir and the Citizenship Amendment Act. A day after Bezos pledged $1-billion commitment, Goyal wondered whether the promised investment by the online retail giant was meant to cover up huge losses it was incurring in the country due to its “predatory pricing or some unfair trade practices”. The minister’s observation not only reflected a poor choice of words but also a negative approach towards businesses.
The Centre has been particularly tough on Amazon and Walmart-owned Flipkart on the alleged circumventing of e-commerce rules, with the Competition Commission of India (CCI) launching an investigation into the fairness of e-commerce operations. By hitting out at the global players and raising the issue of deep discounts, the Centre appears to be trying to placate small traders who are unhappy with the dominance of the online platforms. This also must be seen against the backdrop of political compulsion of wooing small traders and retailers ahead of the Delhi Assembly elections. Small traders, who form the backbone of BJP’s vote-bank, have been protesting against deep discounting and the alleged predatory pricing by Amazon and Flipkart. Though Goyal may be under political pressure to placate small traders, making such flippant statements would send a wrong signal to investors. After all, Amazon’s expansion plan would help millions of small and medium businesses and is expected to create an additional 10 lakh jobs by 2025. Already, over 5.50 lakh businesses in India are using Amazon as a platform to offer millions of products. It has also helped several entrepreneurs go online and many others to export ‘Make in India’ products to different countries.