India's retail association raised concerns over illicit trade and unfair practices by e-commerce firms, urging government intervention. Small businesses face challenges from counterfeit products, predatory pricing, and deep discounting, threatening traditional retail.
The concerns raised by India's retail sector highlight a critical tension between the growth of e-commerce and the sustainability of traditional small businesses. Unchecked illicit trade and unfair pricing practices threaten consumer trust, government revenue, and the livelihoods of millions, potentially undermining India's entrepreneurial culture.
Retailers in India are facing significant challenges due to the rise of illicit trade and unfair market practices employed by e-commerce firms, according to the Federation of Retailers Association of India (FRAI).
At a seminar in Guwahati, FRAI and other participants expressed deep concern over the proliferation of counterfeit products, illegal distribution channels, and non-compliant goods. They highlighted how predatory pricing, deep discounting, and the unchecked expansion of certain e-commerce models are creating severe imbalances for small retailers and kirana stores, which form the backbone of the local economy.
Birendra Ch Baishya, FRAI Assam president, stated that if timely corrective measures are not taken, India risks damaging its traditional entrepreneurial culture. FRAI, representing over 1 lakh micro, small, and medium retailers, called for stronger regulatory oversight, fair competition policies, and a level playing field, urging policymakers to ensure the eradication of illicit products in the online retail ecosystem.
BJP MLA Vijay Kumar Gupta noted that illicit trade and unfair practices adversely affect genuine businesses, government revenues, consumer trust, and the livelihoods of traders. He pointed out that while quick commerce and e-commerce offer convenience, they also facilitate the rapid spread of illicit and counterfeit products, making it difficult for consumers to distinguish between genuine and fake items.
State Taxes Assistant Commissioner Momshad Dinory added that illicit traders exploit digital platforms due to weak monitoring mechanisms and consumer obsession with discounts and instant availability, making consumers more price-sensitive than quality-conscious. FRAI Assam secretary Gauri Shankar Jaiswal emphasized that the extreme accessibility and race for cheaper prices through quick commerce are enabling banned, illegal, and counterfeit products to enter the market at an unprecedented scale.