With reference to foreign-owned e-commerce firms operating in India, which of the following statements is/are correct ? 1. They can sell their own goods in addition to offering their platforms as market-places. 2. The degree to which they can own big sellers on their platforms is limited. Which of the above statements are correct?

QUESTION

Hard

Economy

Prelims 2022

With reference to foreign-owned e-commerce firms operating in India, which of the following statements is/are correct ?

They can sell their own goods in addition to offering their platforms as market-places.
The degree to which they can own big sellers on their platforms is limited.

Which of the above statements are correct?

Select an option to attempt

Explanation

Foreign e-commerce companies cannot directly sell their own goods through an inventory-based model in India. This is to ensure a level playing field for domestic sellers and protect small retailers.

Marketplace model allows these companies to operate as online marketplaces, providing a platform for other sellers to list and sell their products.

India amended its FDI policy in e-commerce marketplaces in 2018 to classify any vendor accounting for more than 25% of the platform’s total sales as controlled by the marketplace operator. So, no seller must exceed 25 per cent of the total business on any foreign e-commerce platform. So, statement 2 is correct.

Note: UPSC officially give D as correct answer but as per SuperKalam the correct answer should be B

Trusted by 2L aspirants