Traders plan nationwide bandh against Walmart's Flipkart buy
21 August 2018
Traders across the country will go on a “Bharat Trade Bandh” on 28 September in protest against the government policy of facilitating the merger of US retail giant Walmart and Indian online marketplace Flipkart, which, they say will create an uneven platform for local retailers.
The Confederation of All India Traders (Cait) plans to start a nationwide ''Rath Yatra'' beginning 15 September and a massive traders rally on 16 December at New Delhi.
The move comes after Walmart Inc on Saturday announced the completion of its acquisition of a 77-per cent stake in Indian e-commerce major Flipkart.
CAIT today said it has called a Bharat Bandh on 28 September to oppose US retail major Walmart’s acquisition of Flipkart. CAIT secretary general Praveen Khandelwal said the deal has “violated Press Note No 3 of 2016 of government and is a combination of a sinister design to control and dominate the retail trade through the passage of e-commerce policy”.
The commerce and industry ministry notified FDI policies through Press Note 3, which was released in 2016, enlisting guidelines for foreign direct investment in e-commerce sector. It also claimed that no discounting is allowed and that no inventory ownership directly or indirectly is allowed by e-commerce marketplaces.
"We are organising a 'Bharat Trade Bandh' on September 28 against the Walmart-Flipkart deal. We want the government to nullify the deal as it is against the sector," IANS quoted Khandelwal as saying.
"We have also planned a host of other activities like a mega traders protest march to gain public support against the deal."
Announcing the completion of its acquisition of Flipkart Group on Saturday, Judith McKenna, president and CEO of Walmart International, said, “Walmart and Flipkart will achieve more together than each of us could accomplish separately to contribute to the economic growth of India, creating a strong local business powered by Walmart.”
In May this year, Walmart agreed to pay $16 billion for a 77-per cent stake in Flipkart, a transaction that valued the homegrown e-commerce company at over $20 billion.
While the deal would pitch Walmart, the world’s largest retailer in direct competition with its US rival Amazon.com in a battle for dominance of India’s online retail market, Cait says it will uproot small traders in the country.
The Competition Commission of India (CCI) recently approved Walmart’s plan to acquire the majority stake in Flipkart, despite the protests from Indian traders. The government has already given its go-ahead to the deal.
Walmart, meanwhile, said its investment will benefit India by providing quality, affordable goods for customers while creating new skilled jobs and opportunities for suppliers.
India’s e-commerce sales are expected to grow at a 30 per cent CAGR through FY 2027 and touch $200 billion of gross merchandise value, according to financial services firm Morgan Stanley. “We are confident that together we can drive the next wave of retail in India,” said Binny Bansal, Flipkart’s co-founder and group chief executive officer.
Flipkart’s existing management team will continue to lead the business. Tencent Holdings Limited and Tiger Global Management LLC will remain represented on the Flipkart board, in addition to independent board members, and will be joined by new members from Walmart.