Indian regulators shed light on FDI in ecommerce

She listed three circumstances under which an entity is permitted to undertake retail trading through ecommerce, fibre2fashion.com reports. First, a manufacturer is permitted to sell its products manufactured in India through ecommerce retail.

Second, a single brand retail trading entity operating through brick-and-mortar stores, is permitted to undertake retail trading through ecommerce. Third, an Indian manufacturer is permitted to sell its own single brand products through ecommerce retail.

Indian manufacturer would be the investee company, which is the owner of the Indian brand and which manufactures in India, in terms of value, at least 70% of its products in house, and sources, at most 30% from Indian manufacturers.

She also said that, as per regulations framed under Foreign Exchange Management Act, (FEMA) 1999 to promote foreign investment, FDI up to 100% under the automatic route is permitted in companies engaged in ecommerce provided that such companies would engage in Business to Business (B2B) ecommerce.