Amazon And Indian Traders Spar At Panel Discussion

Discounted products caused a rift between Amazon and a trading group based in India, Reuters reported Friday (Aug. 30).

The two sides were at a panel discussion organized by the Confederation of All India Traders (CAIT). The competition watchdog represents 500,000 merchants and traders in India and told Amazon’s senior corporate counsel, Rahul Sundaram, of its concerns.

In February, new rules were put in place to aid smaller traders by limiting companies like Amazon and Flipkart, which is owned by Walmart, and their ability to discount. However, the traders said these companies have figured out ways to skirt the rules and continue their practices, which they said puts them at a disadvantage.

Sundaram said Amazon offers opportunities for more than half a million online entrepreneurs. The company’s 57 warehouses in India provide logistics support to small sellers and traders. He also said Amazon has no impact on prices, and the online giant obeyed the rules.

CAIT’s Praveen Khandelwal, however, said Amazon offers discounts no one can meet. As an example, he referred to an air conditioner for 42,000 rupees that could be purchased for 35,000 rupees on Amazon.

Sundaram responded that he once walked around New Delhi for hours looking for an affordable air conditioner, and that he got one for 6,000 rupees.

“It is a factor of the entire retail market that you will get discounts,” he said.

In other news from India, Prime Minister Narendra Modi is merging state banks as the country looks for ways to offset a slowdown of the economy.

Ten banks will be consolidated, Finance Minister Nirmala Sitharaman — including the country’s second-largest state lender, Punjab National Bank. As an attempt to facilitate credit, India will split Punjab into four entities.

Second-quarter figures were the catalyst for change, as economic growth has been its slowest in six years. State banks account for about two-thirds of assets in the banking sector. Bad loans and governance concerns have hampered growth in recent years.