Published On: Tue, Jan 14th, 2020

Bezos braces for tough welcome in India as Amazon faces anti-trust probe & local merchants’ fury

India’s anti-trust panel has launched a probe into Amazon and Walmart-run Flipkart amid claims they violated a competition law, as India’s traders group plans to stage mass protests when Amazon CEO Jeff Bezos arrives this week.

The world’s second richest person and Amazon CEO Jeff Bezos should hardly be counting on a red carpet welcome in India as he arrives in the country’s capital, New Delhi, later this week, with mass rallies and sit-ins being planned by the Confederation of All India Traders (CAIT) protesting what it argues are the online retail giant’s ‘predatory’ trade practices.

The CAIT, which represents some 70 million small traders and businesses, has called on its supporters to go on strike on Wednesday, when Bezos is set to touch down.

The group argues that retail giants such as Amazon and Walmart-owned Flipkart have been selling products at dumping prices, pushing local merchants out of business. The CAIT accused Amazon of trying to spin its vulture capitalism as something that can empower small traders, while peddling “a wrong and false narrative.”

Amazon is trying to create a false propaganda that it is the true friend of traders though it is the worst enemy.

Branding both US-based companies “economic terrorists” that pry on India’s small businesses, the CAIT asked for a meeting with PM Narendra Modi amid reports that Bezos has sought one himself. The association said its biggest rally would be held in front of Amazon India’s offices in Delhi, where Bezos is set to attend an event for small and medium-sized businesses.

The protest sentiment has been building up since late November, when supporters of CAIT and other trade organizations began hitting the streets to voice their outrage over the two e-commerce giants’ alleged violation of competition laws.

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The tactic has seemingly bore fruit, with the Competition Commission of India (CCI) announcing on Monday that it had opened an investigation into the alleged violations by both Amazon and Flipkart, noting that “there exists a prima facie case which requires an investigation.”

The complaint which spurred the probe alleged that the two companies promoted several ‘preferred sellers’ that were in effect controlled by Amazon and Flipkart themselves. The CCI order also noted that the retailers have offered deep discounts and have played favorites with listings by particular sellers, among other things.

“Exclusive launch (of mobile phones) coupled with preferential treatment to a few sellers and the discounting practices create an ecosystem that may lead to an appreciable adverse effect on competition,” said the 11-page order, cited by Reuters.

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The CAIT hailed the decision to launch a probe, calling it “historic.”

Flipkart has brushed off the allegations, while Amazon said it would “welcome” the opportunity to respond to the claims, maintaining that it is “confident” it is not in the wrong.

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