In a bid to level the playing field between online and offline retailers, the Confederation of All India Traders (CAIT) has written to Commerce Minister Piyush Goyal seeking the implementation of a ‘minimum operating price’ below which items will not be allowed to be sold.
The traders’ body also called on the government to take other steps such as asking banks to offer cash-back schemes for offline retailers as well.
“Under the circumstances and visualising it as a price war, we suggest that it is the high time when Government must step in and enforce the fundamental of ‘Minimum Operating Price’ (MOP) which is the price consisting of landing price, operational cost and reasonable profit margin and below the MOP no product should be sold in the market,” the letter said.
The Confederation of All India Traders (CAIT) while expressing its concern on the continuation of unethical and unfair business practices of e-commerce companies prominently Amazon and Flipkart despite of FDI policy in place and several repeated warnings of the Government has mooted a suggestion of introduction of MOP in a communication sent to Union Commerce Minister Piyush Goyal on Sunday.
“It is further disappointing that several banks are also involved in this nexus by offering various cash back schemes exclusively to online sales,” CAIT added. “In this way, brands and e-commerce companies and banks create a mechanism to lower down the prices than the actual market value and causing high level of GST and other revenue loss to the Government.”
The traders body also asked Mr Goyal to enforce a uniform policy of discounts, cash-back, and buybacks for both online and offline trade.
“All schemes of the brands should be made available to online and offline trade in transparent manner,” the letter said. “It will create an even level playing field for every player in retail trade which will encourage fair competition in both offline and online business.”
The CAIT claims to represent seven crore traders across the country and has repeatedly asked the government to look into the alleged predatory pricing conducted by the e-commerce companies.
