CAIT's White Paper Challenges Dominance of Quick Commerce Platforms

The Confederation of All India Traders (CAIT) has released a White Paper criticizing quick commerce platforms like Blinkit and Swiggy for undermining India's retail sector. Accusing them of violating FDI rules and the Competition Act, CAIT urges regulatory intervention to protect small traders and restore fair competition.


Devdiscourse News Desk | Updated: 13-11-2024 15:35 IST | Created: 13-11-2024 15:35 IST
CAIT's White Paper Challenges Dominance of Quick Commerce Platforms
Confederation of All India Traders officials (Photo: ANI). Image Credit: ANI
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The Confederation of All India Traders (CAIT) has made waves with its latest White Paper, released on Wednesday, which underscores apprehensions about the burgeoning practices of quick commerce platforms such as Blinkit, Instamart, and Swiggy. The industry body argues that these platforms are jeopardizing the basic structure of India's retail economy. CAIT is calling for immediate regulatory action to ensure these platforms adhere to fair trade practices and safeguard the interests of small traders across the nation.

In a press conference, CAIT Secretary General, Praveen Khandelwal, criticized the quick commerce platforms for allegedly exploiting Foreign Direct Investment (FDI) norms to dominate supply chains, manipulate inventory controls, and engage in predatory pricing strategies. Khandelwal highlighted that these tactics create an unbalanced competitive landscape, challenging the survival of the country's estimated 30 million Kirana stores.

The White Paper documents alleged infractions by the quick commerce sector, notably in their treatment of FDI policies and Indian competition laws. CAIT contends that these infractions, along with a lack of transparency, threaten to destabilize small businesses and disrupt the retail ecosystem. Highlighting concerns voiced by Union Commerce Minister Piyush Goyal, the industry body emphasized that such anti-competitive practices should not be permissible.

Further, the White Paper accuses quick commerce platforms of investing over Rs 54,000 crores in FDI without channeling funds into infrastructure or long-term assets. Instead, FDI is purportedly used to subsidize losses, monopolize supply chains, and offer deep discounts through a select group of sellers, thereby marginalizing Kirana stores. The paper asserts that such tactics enable these platforms to commandeer 25-30% of a market traditionally controlled by small retailers.

CAIT has outlined several purported regulatory violations by quick commerce entities, including restricted market access, predatory pricing models, opacity, and breaches of Foreign Exchange Management Act (FEMA) guidelines. They urge immediate oversight from regulators and the government to hold these platforms accountable, stressing that unchecked foreign-backed expansion poses a significant threat to small-scale retail businesses in India.

Additionally, CAIT has called upon the government to implement stricter oversight through proposed consumer protection and e-commerce policies, aiming to hold quick commerce platforms accountable and ensure they maintain the integrity of India's retail sector. (ANI)

(With inputs from agencies.)

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