Retailers plan to challenge Walmart-Flipkart deal

Traders fear that Walmart will take the Flipkart route to enter the Indian retail market.

is studying the deal and our organisation will move to appropriate authority and legal recourse.

He said Walmart is not an online company and e-Commerce is not its core competence area.

“There is a move to enter its goods to offline market through the way of online trade,” he said, adding “the government will closely monitor each passage of the deal since it’s not a merger of two companies but will have greater ramifications on retail trade and economy”.

B e s i des CAIT, t h e Swadeshi Jagran Manch (SJM), an affiliate of the RSS, has also decided to oppose the deal.

The Manch activists took to the streets in the capital to protest against the deal.

The SJM also wrote a letter to Prime Minister Narendra Modi opposing the deal.

This is to be noted that US-based retail behemoth Walmart recently announced that it would buy majority stake (77%) in Indian e- Commerce major Flipkart for $16 billion.

“Our investment will benefit India, providing affordable goods for customers, while creating new skilled jobs and fresh opportunities for small suppliers, farmers and women entrepreneurs,” as per a joint statement by Walmart and Flipkart.

“As Walmart scales in India, the company will continue to partner to create sustained economic growth across agriculture, food and retail. Future investments will support national initiatives and will bring sustainable benefits to the country,” the statement read. On the issue of job creation, Walmart India said that it will create jobs by developing supply chains, commercial opportunity and direct employment.

According to Khandelwal, there should be a policy for such deals otherwise this will be a bad precedent. “Virtually, the Indian retail trade will be controlled and dominated by the MNCs and an era of predatory pricing, deep discounting and loss funding will prevail to wipe out the competition which will create an unhealthy market,” he added.

The traders also fear that since Walmart will be controller of the company, it may use the data and other information as per its will and the possibility of compromising the data cannot be ruled out. Also, Walmart will always be in a position to dictate its terms and conditions. Thirdly, it is much more difficult for the government to control and regulate foreign-owned platforms, particularly in e- commerce sector which has no boundaries.

SJM spokesperson Deepak Sharma said the deal is in violation of the rules.

“FDI in e-Commerce is not allowed. Moreover, there are several complaints against Flipkart pending with different government agencies. There is no policy or a regulator for e-Commerce. This deal, if implemented, will lead to unemployment of retail traders. We will oppose this deal tooth and nail,” he said.