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Govt may soon incentivise kiranas for joining e-commerce ecosystem

India may soon incentivise kirana stores to become a part of the e-commerce ecosystem by converting their operations to handle both online and offline sales. The special package of incentives for the smaller format 'mom and pop stores' is likely to be a part of the e-commerce policy being drafted by the Commerce and Industry Ministry.

"We will offer incentives for kiranas willing to integrate their operations on the e-commerce platform so that the switchover could be swift. The incentives could be in the form of interest subventions on loans required for the switchover or as one time grant," said officials privy to the development.

Several technology companies and e-commerce entities, including Facebook, Walmart, and Amazon, have offered to provide necessary technologies that would help kiranas integrate with e-commerce platforms. Trade bodies have also launched various initiatives for this switchover that also requires small store owners to get the necessary skills to handle online sales.

The policy is also likely to encourage the existing e-commerce players to join local stores on their formats and facilitate their sales. In fact, e-commerce companies would be asked to put full details of the sellers on their marketplace so that buyers can take informed decisions and even look to use products sold on the platform by nearby shops for swift delivery and service. The Draft National Ecommerce Policy was floated by the Department for Promotion of Industry and Internal Trade (DPIIT) last year for stakeholder comments. The policy is expected to be finalised this month and announced subsequently.The overarching objective of the policy is promotion of e-commerce ecosystem in the country, increasing jobs and rural productivity, along with exports.

The policy is also expected to put in place an e-commerce regulator with penal powers. The regulator will check and penalise companies spreading false information or failing to comply with laid down regulations. It would also have power to suspend licence of companies or take them to competition regulator for taking any anti-competitive measure.

Officials said that though the policy would not mandate data location for all e-commerce firms, this would be asked for in the case of three-four key strategic sectors for storing genetic material or any other material data.

June 20, 2020

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