E-tailers, sellers make pitch for revised FTP

E-commerce firms such as Amazon and ebay, as well as their sellers, have made recommendations to the government for a differentiated policy framework for e-commerce in the revised Foreign Trade Policy (FTP).

The policy is expected to come into effect from April 1. Changes were suggested because existing policies have largely catered to traditional, offline and business-to-business (B2B) exports only.

They have stressed upon the need to create a conducive policy framework through the FTP for e-commerce exports, which lowers the entry barrier for small businesses, according to industry sources.

“E-commerce export is a $400-billion opportunity, which small and medium enterprises (SMES) from India can directly capitalise on,” said Abhijit Kamra, director (global trade), Amazon India.

He added: “E-commerce exports have been growing rapidly, enabling Indian SMES, handicraft (makers), weavers and traders to dream and realise building global brands — all while sitting in India.”

Kamra added that based on the interactions with industry, if some definitive changes are made in the FTP, the same would create a “bedrock” that would enable the acceleration of e-commerce exports.

Amazon itself aims to digitise 10 million micro, small and medium enterprises (MSMES) and enable $10 billion in exports by 2025. US retail giant Walmart, which owns Flipkart, also recently said it will triple export of goods from India to $10 billion each year by 2027.

Suggestions by companies and sellers pertain to implementing end-to-end digitisation and developing specialised logistics capabilities for export-related processes.

The other suggestions include simplifying compliances and regulatory requirements as well as creating long-term capabilities to support growth and increasing awareness. “Detailed inputs on these provisions should be included in the new chapter on e-commerce exports within the FTP,” said an industry executive.

Operationalisation of these provisions will require coordination of efforts across multiple offices like the Reserve Bank of India (RBI), Customs, Directorate General of Foreign Trade (DGFT) and the MSME ministry. “E-commerce exports have helped reduce entry barriers to international markets, offering us cost benefits and the opportunity to rapidly scale our business,” said Dhvanil Sheth, founder and chief executive of Skillmatics, which develops innovative educational products and games for children. Industry experts said FTP could focus on several short to mid-term measures. These would help iron out operational inefficiencies that MSMES face as they export through the ecommerce channel.

It could include measures like digitising the process of AD code (authorised dealer code) registration as well as automating the processes related to EBRC (bank realisation certificate) and EFIRC (foreign inward remittance certificate) procurement and consolidation.