Almost two weeks ago, on 3rd May, TFI published an article that after the lockdown, government would promote local Kirana stores and markets while e-commerce players like Amazon and Flipkart, which discriminate with retailers despite being third party platforms, would feel the heat.
In yesterday’s address at 8 PM, PM Modi appealed on very similar lines. He said that local manufacturing and supply chains sustained us in the tough times of Corona, and the people of the country now must pay back to these shop owners. Making a case for “Atmanirbhar Bharat- self dependent India”, PM Modi asked the people to be “Vocal for local” products.
He said, “Global brands began locally. But when their people started marketing, branding and praising, they became global. Every Indian should become vocal for local. Don’t just buy, but promote.”
Since the announcement of Coronavirus induced lockdown, the local Kirana stores have kept our lifeline running. Had it not been the sophisticated network of Kirana stores, which not only supply products but also extend credit to known people during difficult times, millions of people would have been forced to sleep without a two-time meal. The government has noticed the herculean effort made by Kirana stores and is willing to extend policy support.
PM Modi also praised the local supply chains and manufacturing for sailing the country through Corona crisis and said, “Local helped us through the crisis, helped us survive. We have to make local our motto.”
Foreign owned e-commerce firms like Amazon and Flipkart, which followed discriminatory practice towards the local shopowners to win the discounting game, are now under the radar of the government.
Last month, when the announcement of second phase lockdown was made, the government shocked e-commerce companies by not allowing them to extend the delivery of non-essential items.
Last year, speaking at an event in New Delhi, Commerce and Industry Minister Piyush Goyal had said, “They [Amazon] may have put in a billion dollars but if they make a loss of a billion dollars every year, then jolly well will have to finance that billion-dollar. So, it is not as if they are doing a favour to India when they invest a billion dollars.”
After PM Modi’s speech, it is very much evident that the government is willing to pay back to the local stores for being frontline warriors against Coronavirus. Given the fact that the major e-commerce players in India- Amazon and Flipkart- are foreign-owned entities, the government would rather support Jiomart, which aims to support local shops in its e-commerce model.
Jiomart has already begun testing in Mumbai and is planning to launch the service very soon with the help of newly inked deal with Facebook which would allow it to use Whatsapp Pay and penetrate to rural markets.
One can contest the unfair policies of the government towards existing e-commerce companies but the government allowed them to operate for such a long time despite the fact that they openly flouted the norms by opening their own retail stores. The government is just correcting its mistakes by supporting the Kirana stores and local shops in the market.
A few weeks ago, Principal Economic Advisor Sanjeev Sanyal, who is among the influential members of the Modi government when it comes to economic policymaking, tweeted in support of local market shops:
One of the backbones of the #Covid19 lockdown is India's Kirana-shop network. They have not merely kept 1.3bn people supplied despite many difficulties, they extend localized credit, provide doorstep delivery, and source products for specific needs. An incredible effort.
— Sanjeev Sanyal (@sanjeevsanyal) April 18, 2020
He tweeted, “One of the backbones of the #Covid19 lockdown is India’s Kirana-shop network. They have not merely kept 1.3bn people supplied despite many difficulties, they extend localized credit, provide doorstep delivery, and source products for specific needs. An incredible effort.”
Argued for modernization of these shops for the 21st century, Sanyal further wrote, “This Kirana-shop network is not merely an important part of our economic system but is part of our social capital. It should not be allowed to be dissolved by impersonal mega-chains. We need to clean up local market places & modernize them for the 21st century.”
Another influential BJP personality who actively supports the cause of local traders and Kirana stores is Dr Subramanian Swamy. Last year, Swamy tweeted, “We should back our traders on the Flipkart/ Amazon issue. When we can access Amazon of USA through credit cards what is the need to allow Amazon in India? Traders are a solid base of our culture and Amazon will destroy that. Same problem with Walmart.” Dr Swamy regularly supports the cause of CAIT and speaks about it on public forums and twitter.
We should back our traders on the Flipkart/ Amazon issue. When we can access Amazon of USA through credit cards what is the need to allow Amazon in India? Traders are a solid base of our culture and Amazon will destroy that. Same problem with Walmart
— Subramanian Swamy (@Swamy39) October 21, 2019
With PM Modi’s personal efforts in promotion of local products and local supply chains, the golden days for more than 2 crore local retailers, who suffered in the hands of Flipkart and Amazon, are ahead. Now the e-commerce companies would not be given a free pass to sell discounted products of their own companies despite being a third party platform, and this would benefit the local supply chains.