India Inc elated at Walmart-Flipkart deal
Expressing their happiness over Walmart's $16-billion acquisition in the country's e-commerce space, Indian industries sees the deal as a salute to the success of the start-up sector that pioneered the fledgling online retailing in a country where bulk of the trade is in the unorganised sector. "Is not it so great that a start-up goes on to fetch an enterprise
valuation of about $21 billion, making the Walmart equity infusion the largest ever foreign direct investment (FDI) into India", ASSOCHAM Secretary General DS Rawat said.
However traders and retailers also said that US retailer Walmart's acquisition of Flipkart will vitiate the country's e-commerce space and create an uneven playing field. "Despite several teething troubles, hats off to Indian entrepreneurs, especially those of the 'First Generation'. For them, it is no-holds barred. Great spirit of enterprise," Rawat added.
Former Chief Financial Officer of Infosys Ltd V Balakrishnan also said it was a great validation of the potential of Indian consumer market as well as the evolving startup ecosystem.
Confederation of All India Traders (CAIT) said the deal is nothing but a clear attempt to control and dominate the retail trade in India by Walmart through e-commerce in the long run. On the other hand, Retailers Association of India while staying away from commenting directly on the acquisition, said some e-commerce companies in India have been flouting FDI Policy for marketplaces.
"Digitally powered e-Walmart will certainly vitiate the e-commerce and retail market. There will be an uneven level playing field to the disadvantage of retail traders. Only the venture capitalist, investors and promotors will be benefitted and not the country," CAIT said in a statement.
CAIT Secretary General Praveen Khandelwal said the key issue is whoever controls the platform controls data and digital intelligence. "The owner can squeeze and dictate anything. It is much more difficult for the government to control and regulate foreign owned platforms and all indigenous players will have no value if a foreign company runs the platform," Khandelwal claimed.
He said the Government should immediately frame a national policy for e-commerce and constitute a regulatory authority to regulate e-commerce business in India and till such time, the deal should be put in abeyance by the Government and a close scrutiny should be held of the entire deal.
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