Question : Growth of e-Commerce Sector

(a) whether the e-commerce sector in India is poised for exponential growth in the country in the coming years and if so, the details thereof;
(b) whether of late the Ministry has given clearance to any International e-commerce company to invest in India in online retail market;
(c) if so, the details thereof, companywise;
(d) whether the advent of foreign investors would affect the Indian origin e-retail companies and if so, the details thereof;
(e) whether the Ministry has opened up the retail e-commerce market for FDI in the country and if so, the details thereof; and
(f) the corrective steps taken by the Government to protect Indian interests in this regard?

THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY
(SHRI C. R. CHAUDHARY)

(a): As per the Economic Survey 2017-18, the electronic commerce (e-commerce) market in India is estimated at US $33 billion with a 19.1 percent growth rate in 2016-17. As per the National Association of Software and Services Companies (NASSCOM) Strategic Review 2018 in the Information Technology and Business Process Management (IT-BPM) sector in India, the Indian e-commerce market was USD 33 billion in 2017 and reached USD 38.5 billion, growing at a rate of about 17% in the financial year 2018.
(b), (c), (d) & (e): The extant Foreign Direct Investment (FDI) policy permits 100% foreign investment under the automatic route in companies engaged in e-commerce provided that such companies engage only in Business to Business (B2B) e-commerce.Further, as per Guidelines for Foreign Direct Investment (FDI) on e-commerce, 100% FDI under automatic route is permitted in marketplace model of e-commerce but FDI is not permitted in inventory based model of e-commerce. Moreover, an entity is permitted to undertake retail trading through e-commerce under the following circumstances, subject to conditionalities listed in the FDI policy:
(i) A manufacturer is permitted to sell its products manufactured in India through e-commerce retail.
(ii) A single brand retail trading entity operating through brick and mortar stores, is permitted to undertake retail trading through e-commerce.

(f): FDI in retail has been allowed in a calibrated manner after having intensive consultations with stakeholders including concerned Ministries/ Departments, State Governments, apex industry chambers, Associations and other organizations taking into consideration their views/comments.

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