India to launch open network for digital commerce to take on Amazon, Walmart

The Indian government is all set to launch an Open Network for Digital Commerce to end the dominance of the US-based e-commerce companies like Amazon and Walmart in India.

HIGHLIGHTS

• The Indian government is all set to launch an Open Network for Digital Commerce.
• The government wants to end dominance of the US-based e-commerce companies like Amazon and Walmart in India.
• The launch of the ONDC platform comes in the wake of India’s antitrust body raid on domestic sellers of Amazon and some of Walmart’s Flipkart.
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The Indian government is all set to launch an Open Network for Digital Commerce to end the dominance of the US-based e-commerce companies like Amazon and Walmart in India. The ONDC platform will let buyers and sellers interact with each other and transact online. The launch of the ONDC platform comes in the wake of India’s antitrust body raid on domestic sellers of Amazon and some of Walmart’s Flipkart. The company’s were accused of violating the laws.

With the launch of ONDC, the government aims to promote an open platform for exchange of goods and services through electronic networks. The open network platform will be launched in five cities including Delhi NCR, Bengaluru, Bhopal, Shillong and Coimbatore, an official said on Thursday. It would later be expanded to other cities.

As per Reuters report, the Modi government and its key supporters have long contended that Amazon and Flipkart only benefit a few big sellers through predatory pricing. However, the companies have always maintained that they comply with the laws set by the Indian government.

Amazon and Flipkart are yet to react to the government’s ONDC platform. The report stated that India's ONDC plan aims to onboard 30 million sellers and 10 million merchants online. The plan is to cover at least 100 cities and towns by August. The government will focus on apps in local languages for buyers and sellers. The apps would highlight small merchants and rural consumers.

The government in a document revealed that the retailers and venture capital firms have lended support to the ONDC plan. Banks such as State Bank of India, ICICI Bank and Bank of Baroda have already committed total investments of 2.55 billion rupees.

As per an investigation conducted by Reuters last year, Amazon was accused of giving preferential treatment for a years to a specific group of sellers on its platform and used them to bypass Indian laws. Amazon had denied the allegations.