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New FDI Policy Forces Amazon, Other Retailers To Pull Down Products Sold By Firms In Which They Have Stakes
Swarajya Staff
Feb 03, 2019, 06:24 PM | Updated 06:24 PM IST
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The new Foreign Direct Investment (FDI) policy rules for e-commerce companies have impacted firms negatively as large online retailers led by Amazon India started pulling down some products that were sourced through their biggest sellers in which they owned stakes, reports Live Mint.
“We noticed that several product listings (sold by Cloudtail and Appario) on Amazon India were removed," said an analyst.
Anchor sellers such as Cloudtail and Appario who formed the significant chunk of Amazon India’s sales retracted their products and were replaced by other vendors. Furthermore, Amazon backed out on its grocery offering in India right before the regulations took effect.
However, a similar impact was not to be seen on Flipkart’s website. Flipkart-owned fashion website Myntra continued to sell its private labels including HRX, in which it holds a 51 per cent stake. In addition to that, Flipkart’s products also continued to display discounts notwithstanding FDI’s new policy rules which stated that marketplaces could not influence the price of commodities.
Furthermore, Amazon India and Amazon did not respond to queries which sought comments on the impact of the FDI guidelines.
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