eBay acquisition to give Flipkart access to foreign markets

27 Apr 2017

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Flipkart's impending acquisition of eBay India will give it a launch pad to gain access to attractive export markets, and the company is gearing up to tap the multi-billion dollar foreign ecommerce markets, estimated to grow to $1 trillion by 2020, Financial Express reports.

Currently only Amazon.in (through its global selling programme) and eBay India allow sellers registered on their platforms to sell goods outside India, and Flipkart had for a long time missed out on this opportunity. The deal with eBay is expected to close in a few months' time.

While Amazon made a late entry into the Indian ecommerce market, it realised the potential of on-boarding Indian exporters. Last year Amazon launched its global selling programme in India and has currently 20,000 Indian sellers listing over 45 million products for the overseas market.

Now Flipkart has the chance to have a crack at this market, and wants to catch up with Amazon.

eBay.in is an attractive platform for Indian sellers looking for western markets and gives the exporters access to 150 countries including US, UK, Australia and Germany.

A recent US regulatory filing by eBay Inc had said Flipkart and eBay will exclusively pursue cross-border trade opportunities together. A Flipkart spokesperson told FE, ''eBay, being a pioneer of ecommerce globally, has a unique position in the market that will be a great addition to Flipkart's strong presence along with its group companies. The deal with eBay gives Indian customers access to eBay's vast international product catalogue, while also giving Indian sellers a platform to sell in the global markets that eBay operates in.''

Flipkart's acquisition of eBay's Indian arm has also come at a time when the Indian government is encouraging exports through ecommerce portals.

The union government has in its foreign trade policy 2015-2020 has decided to provide incentives to promote exports of goods hosted on a website and dispatched through courier or postal mode.

As per India's FTP 2015-20, the incentives for e-commerce exports are under the Merchandise Export from India Scheme (MEIS). ''Goods falling in the category of handloom products, books / periodicals, leather footwear, toys and customized fashion garments, having FOB value up to Rs25,000 per consignment (finalized using eCommerce platform) shall be eligible for benefits under FTP,'' it states.

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