What is E-Commerce?
E-Commerce is any business transaction happening online the most popular example of E-Commerce is online shopping, however E-Commerece also helps us carry out other services like e-banking , e-ticketing and online food order requisition
Now then, how is the scenario of e commerce in India?
With the growth in the number of users of internet which is expected to further rise to about 660 million by 2021, the E-Commerce industry in India will only shoot up rather than seeing the downside.
The industry took its baby steps into the Indian market in 2009 when its value who was estimated at around $3.9 billion.
Within the next five and half years the increase of online Shoppers when up to $40 billion with electronics and apparel being the biggest categories in terms of sales.
Today, that is the mid 2020 it has seen growth with every 1 out of 3 internet users shopping online and deliveries reaching up to 20,000 pincodes all across India.
The industry has shot up to $120 billion market as of 2020 as reported by India Brand Equity Foundation.
Government policy on reforming The E-Commerce industry in India and its impact.
The new policy for E-Commerce was brought about by the government of India in the month of December 2018 and has been in effect from February 2019. The policy is briefed as what follows:-
1.The policy for E-Commerce prohibits companies from selling products only on their self made portals.
2. Discounts offered by online E-Commerce firms are expected to drop sharply.
3. Online entities with foreign investments will not offer products sold by retailers in which they hold equity.
4. The policy also mentions of not stocking up from a single vendor more than 25%.
Government to promote E-commerce in India are as follows:
Government e-Marketplace (GeM) signed a Memorandum of Understanding (MoU) with Union Bank of India to facilitate a transparent payment system for many of its services from October 2019
The government in February 2019 launched Draft National e-Commerce Policy which promotes FDI in the current market scenario of Indian E-Commerece.
All majors will now have to restructure their business patterns to accommodate more third party sellers will they have no stake involved. While the government says that this move would benefit the customers by providing them a larger platform to shop from but on the contrary Mukesh Aghi, president of US India Strategic and Partnership Forum (USISPF) said “this is not in the best interest of the Indian consumers, coming out with such a major policy change overnight without any consultative process eats into the predictability and reliability factor that all US companies are looking into India for any foreign direct investment”.
Impact of covid On The E-Commerce industry in India
One of the few Industries that have been benefited during this lockdown due to Covid-19. Since the disease spreads primarily through contact with an infected person or when a person touches a surface that has the virus, the best is to stay indoors. This has increased online shopping usage globally and so in India. In India it has led to a rise in the number of FTU’s or first time e commerce users in India who had been so far inhibited to shop online. Hence while most of the other industries in India are suffering a deep challenge as to how to deal with this current situation the online E-Commerce market has constantly face healthy troubles in keeping up up with the demand of the customers.
Problems and hiccups related to this industry.
The number of online shopping frauds registered is six times from 977 cases in FY17 to 5,620 cases in FY20 till November 2019, meaning the total number of cases are 13,993 till FY20.
The multiple ways of committing fraud and treachery in this sector of e-commerce could be as below:-
1. Fraud in distribution and sales.
2. Delivery of counterfeited and expired products.
3. Cases of fraudulent gateways
4. Management of inventory.
5. Unsuitable employees for the sector being hired
6.Cyber-crime.
Way ahead for E-Commerce industry in India
The E-commerce industry in India has been an invisible constant supporter for the MSME sectors, by providing means of livelihood with the help of their larger platform . The E-Commerce industry in India has been growing ever since and it is on the verge of becoming the second best in the sector overpowering the USA by the year 2034. The increase in its overall revenue and also creating a larger platform has resulted in creation of more employment ,increase in revenues from export, increased tax collection, and provide better products and services to customers in the longer run and slowly covering almost all of the 100,00 pincodes across India does further increasing its reach to the rural India.
Sources: IBE Foundation, Wikipedia, India Today Business, Oberlo business.
-Dibyendu Roy.