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



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.


Promotion and Regulation of E-commerce in India_3.1


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.


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