The commerce minister Piyush Goyal said on Thursday said that the government is probing Walmart-owned Flipkart and Amazon over the alleged predatory pricing.
Detailed questionnaires have been sent to these companies and their response is awaited, he added. The minister also warned of stringent action as per the law for any violation. "E-commerce companies have no right to offer discounts or adopt predatory prices. Selling products cheaper and resulting the retail sector to incur losses is not allowed," Goyal told reporters.
Recent media reports indicated that the e-commerce majors have grossed up over $3 billion in gross merchandise value during the festive sales held over the past fortnight. This is said to be over half of their annual sales. They are also not permitted to own products and sell them, he said and that they are only platforms helping sellers connect with potential buyers.
Goyal said his ministry has received complaints from the traders body CAIT alleging violations of norms by these players. The national traders body CAIT had in a letter on Monday urged Goyal to order an audit into the business model of all e-commerce firms and the foreign-owned Amazon and Flipkart in particular.