Commerce Ministry calls meeting with banks on July 10 on FDI in e-commerce

New Delhi: The Commerce and Industry Ministry has called a meeting of public sector banks on July 10 to discuss issues related with e-commerce retailing. The issues, which would come up for discussions include payment mechanisms of the e-commerce companies and the role of banks, sources said.

The meeting would be chaired by Commerce and Industry Minister Nirmala Sitharaman. The same day she would also meet with other stakeholders including industry representatives on foreign direct investment (FDI) in e-commerce retailing. Representatives of companies such as Flipkart, Amazon and Snapdeal are expected to participate in the meeting.

Last month, the minister had discussed the matter with all stakeholders. She had said the meeting was to understand the broader context of e-commerce and whether FDI in the sector is affecting the level-playing field of the brick and mortar stores.

At present, 100 per cent foreign direct investment is allowed only in business-to-business (B2B) e-commerce and not in the retail segment. Global retail giants, including Amazon, and the domestic industry want the government to relax the foreign investment norms in the e-commerce space.

Further on July 15, the minister has called a meeting with the states on the issue. The ministry has written a letter to all Chief Ministers requesting them to nominate the concerned minister on the matter to participate in the meeting. Global players are looking at India because the country is one of the fastest-growing markets in Asia-Pacific, along with China.

Rise in Internet penetration, adoption of smartphones and lower data rates are completely changing the way India shops. According to estimates, the sector's market size in the country is at around USD 5 billion annually. Analysts said online shopping is expanding at a massive rate.