A proposal to allow FDI in an inventory-based model of e-commerce only for export purposes is under examination as it will help increase India’s outbound shipments without impacting the businesses of small retailers, Commerce and Industry Minister Piyush Goyal said.
At present, the country’s FDI policy does not permit foreign direct investment (FDI) in the inventory-based model of e-commerce. It is allowed only in firms that are operating through a marketplace model.
“I liked that proposal, the department is examining it,” Goyal told PTI.The minister said that if such e-commerce firms want to keep inventory for exports, then “I think we have no objection to that”.
When asked if the ministry will tweak the policy for that, he said: “We may need to issue a clarification” in this regard. The proposal was mooted by the Directorate General of Foreign Trade (DGFT) and is being examined by the Department for Promotion of Industry and Internal Trade (DPIIT).
E-commerce stakeholders, too, have asked for a relook at the FDI policy on this issue.The proposal is important as the government is looking at ways to boost exports through the e-commerce medium. It is working on measures such as setting up e-commerce export hubs.As per estimates, the country’s e-commerce exports currently stand at USD 2 billion as compared to China’s staggering USD 350 billion.
The global e-commerce trade is about USD 800 billion, and it is estimated to reach USD 2 trillion by 2030.
A report by economic think tank GTRI India’s e-commerce exports have the potential to reach USD 350 billion by 2030, but banking issues hinder growth and increase operational costs.
India’s e-commerce industry is driven primarily by small businesses that export products valued between USD 25 and USD 1,000. The popular items include Handicrafts, art, books, ready-made garments, imitation jewellery, gems and jewellery, home decor, ayurveda products and sports goods.
India has set a target of USD 1 trillion of merchandise exports by 2030 and cross-border e-commerce trade has been identified as a source to meet this aim.On the country’s exports, Goyal said, despite global uncertainties, the shipments are growing at a healthy rate.
During April-August 2025-26, exports rose to USD 184.13 billion from USD 179.6 billion in the same period last fiscal.The imposition of high tariffs by the US on a number of countries, including India (50 per cent), has disrupted global trade.The World Trade Organisation (WTO) has projected that the global merchandise trade is expected to grow 2.4 per cent this year and only 0.5 per cent next year. The minister said that exporters are looking at alternative markets to increase their shipments.
“We are focusing on new markets,” he said.Goyal was here on a two-day official visit to meet Qatari leaders and businesses and discuss ways to boost bilateral trade and investments. He was leading a business delegation.
