ONDC to protect independent sellers on ecommerce platforms – News

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ONDC will safeguard consumer interest and protect small businesses by giving them equal opportunity to sell their products and services.



Published: Sat 23 Apr 2022, 5:50 PM

Last updated: Sat 23 Apr 2022, 5:52 PM

Question: Some of the e-commerce companies are showing preference for certain sellers of products and do not give the consumer a choice of all the sellers. This restrictive practice is causing lot of heart burn amongst small producers and manufacturers. I hope the Indian Government is looking into this matter and frames relevant guidelines.

A new platform called Open Network for Digital Commerce (ONDC) is being formulated by the authorities for which rules are to be framed. These rules will apply to all companies engaged in digital commerce. This is being done to protect independent sellers on ecommerce platforms who have alleged that e-commerce companies give preferential treatment to some sellers. On certain platforms a limited number of sellers pop up more often than third party entities.

Therefore, the Government is working on new policies to bring about ‘algorithmic fairness’ for consumers who use the e-commerce platforms. These rules will make it compulsory for e-commerce firms to show search results of multiple sellers. The rules will also restrict e-commerce companies from sharing consumers’ buying behavior. ONDC will safeguard consumer interest and protect small businesses by giving them equal opportunity to sell their products and services. This framework is being formulated by the Consumer Affairs Ministry of the Government of India.

With food shortages being faced all over the world, will India be able to take advantage of the demand for staple food items which are critically needed in some African countries?

The Indian Government has shown its willingness to supply food grains to the world if the World Trade Organization permits it. The Government has agreed to increase shipments of wheat and sugar to help ease the global food shortages due to the recent geopolitical situation. Currently India has a huge stock of 51.3 million tonnes of rice and wheat and another 34 million tonnes of unmilled paddy which is lying with State Governments.

The total stock as on April 1 this year is two and a half times more than what the Government needs to keep in stock to meet the country’s requirements under the National Food Security Act and Centrally sponsored social welfare programs. This cushion will enable the Indian Government to ship food grains as expeditiously as it is logistically possible having regard to constraints of shipping lines.

The Indian Meteorological Department has forecast a near normal monsoon season starting in June this year. Despite the shortage of fertilizers, the target for food grain production is estimated to be 328 million tonnes in 2022-23 which will add to the surplus stock of food grains in the country.

With foreign tourism taking a hit during the last financial year on account of the Covid lockdown, have export earnings from the services sector taken a beating?

It is true that services such as tourism, aviation and hospitality were severely affected during the financial year 2021-22 on account of lockdown in several countries. However, exports of other services during this financial year rose by more than 21 per cent and for the first time touched the figure of $ 250 billion which is higher than the target of $ 225 billion.

Import of services during the same financial year was to the extent of $ 144.8 billion. Consequently, in respect of the services sector there is a trade surplus of $ 105.2 billion.

India’s overall trade, comprising goods and services, has increased by 34 per cent with merchandise exports pegged at $ 420 billion during the financial year ended on March 31, 2022. During the current financial year 2022-23, both goods and services exports are expected to take a quantum leap in view of trade agreements having been signed with the UAE, Australia and other countries.

India will move beyond export of low cost services to high level research services as well as export of software in new critical areas of artificial intelligence, robotics, etc.

HP Ranina is a practicing lawyer, specializing in tax and exchange management laws of India.

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