American e-commerce giant Amazon has been accused of favouring big sellers/retailers on its platform in India. After this, a group of Indian retailers have urged the government to ban the local operations of Amazon.
A report by news agency Reuters has revealed that Amazon few sellers in India are accounted for as much as 35 per cent of platform’s sales revenue in early 2019. This means that only 35 of Amazon’s seller base of 4 lakh small retailers in India accounted for around two-third of its online sales in the country.
Senior Amazon.com Inc executive Jay Carney was preparing for an important meeting with India’s Ambassador to the US. The former press secretary to ex-US President Barack Obama was in a note told to highlight the fact that the e-commerce firm is committed more than $5.5 billion investment in India and how it can ease lives of over 4 lakh small sellers registered on it.
“But he was cautioned not to divulge that some 33 Amazon sellers accounted for about a third of the value of all goods sold on the company’s website. That information, the note advised, was ‘sensitive/not for disclosure” reported Reuters. Reuters adds that it’s unclear what Carney ended up telling the Indian ambassador during their meeting in April 2019.
Other company documents reveal equally touchy information: Two more sellers on the e-commerce giant’s India platform – merchants in which Amazon had indirect equity stakes – accounted for around 35% of the platform’s sales revenue in early 2019. That meant some 35 of Amazon’s more than 400,000 sellers in India at the time accounted for around two-thirds of its online sales.
“All these information were indeed politically sensitive. If they got out, they could give fresh ammunition to small Indian retailers who allege that Amazon harms their businesses by flouting federal regulations and by favoring a few big sellers. It could have annoyed Prime Minister Narendra Modi, whose political base includes millions of small retailers. And it would have undercut Amazon’s public messaging that it is the friend of small businesses in India. As the company says in one marketing slogan in India, it is ‘transforming lives, one click at a time’,” the report revealed.
In a written response to the Reuters story, Amazon said it ”does not give preferential treatment to any seller on its marketplace,” and that it ”treats all sellers in a fair, transparent, and non-discriminatory manner, with each seller responsible for independently determining prices and managing their inventory.”
The Indian retailer group said the Reuters report “vindicates the stand and arguments” it made in recent years. “The CAIT will raise this issue in a bigger way,” the group said.
In a statement, the Confederation of All India Traders (CAIT), which says it represents 80 million retail stores in India, said “the shocking revelations” in the Reuters story are “sufficient enough to immediately ban operations of Amazon in India.”
The group called on Commerce Minister Piyush Goyal to take immediate note of this “important and burning issue and order for a ban on operations of Amazon in India.”