Parliamentary Panel Report on Promotion and Regulation of E-commerce in India

Table of Contents

E commerce in India: Relevance

GS 2: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Open Network for Digital Commerce: Context

Recently, a parliamentary panel has brought up a new report on promotion and regulation of ecommerce in India where the panel called for identifying entities that act as ‘gatekeeper’ platforms.

Regulation of E commerce in India: Recommendations

Tighter regulation on ecommerce companies.
Amending the Competition Act, 2002 to set parameters for the ecommerce platform to qualify as gatekeepers.
The Competition Commission of India (CCI) should formulate a mandatory code of conduct specifying the acceptable conduct between marketplaces and their customers.
Stringent regulation, including the drafting of epharmacy rules, for e-pharmacies in our country over the alleged misuse of epharmacies for distribution of illegal and counterfeit medications.
Digital Market Division: Creation of a separate expert division, Digital Market Division, within the CCI to regulate ecommerce platforms and bridge gaps in enforcement.
Setting up a framework to ensure periodic exchange of information between the CCI and other regulatory bodies to ensure effective coordination.
The exemption provided to offline sellers with regard to GST registration should be extended to online sellers as well.
- Reason: The mandatory GST registration has placed an undue burden on small sellers operating on ecommerce platforms that had resulted in high dropout rate of 60-70% from online platforms.
Finalise the draft national ecommerce policy at the earliest.
10-minute delivery model: Government should address the concerns related to safety of riders in the 10-minute delivery model.
Open Network for Digital Commerce (ONDC): The panel has urged the government to formulate a strategy to ensure a level playing field between small business and big online vendors.
- Reason: The panel has raised concerns regarding the operational strategy of ONDC and have also raised questions on the technical capability of MSMEs to leverage the network.

Open Network for Digital Commerce: Key points

The government has set up a nine-member advisory council headed by National Health Authority CEO R S Sharma, on steps required to design and accelerate adoption of ONDC.
ONDC is a not-for-profit online network to check the dominance of e-commerce giants such as Amazon and Flipkart.
A budget of about Rs 10 crore for initial work on the Open Network for Digital Commerce (ONDC) initiative was approved by the Government.
ONDC is expected to curb digital monopolies and standardize the on-boarding of retailers on e-commerce sites.