Indian government bats for 50% FDI in e-commerce

According to the source, in the paper, the government has sought comments on whether 50% FDI in e-commerce should be allowed without any prior approval from the government. It has also asked whether FDI in e-commerce should encompass goods, services and intellectual property. Even if it allows FDI, the government may put in a mandatory 40% sourcing clause from small and medium enterprises. Currently, 100% FDI is allowed in business-to-business e-commerce, while business-to-consumer is prohibited.

The discussion paper also highlighted the fact that Indian e-commerce market is at a nascent stage of development. As a result, entry of global players will have adverse impact on this domestic industry, thereby leading to monopolies in e-commerce, manufacturing, logistics and retail sector.