New Delhi : Industry group leaders today made a strong pitch for a liberal regime for B2C ecommerce as a precursor to kick-starting a manufacturing boom in India. Emphasizing the growing contribution of the E-commerce industry to the Make in India campaign, leading stakeholders of the sector – eCommerce Association of India (ECAI), All India MSME Association (AIMA) and industry voices at ASSOCHAM urged the government to liberalize inventory led B2C Ecommerce which would create tremendous impetus for the growth of local manufacturing and in turn further boost the Make in India program in the country.

Prime Minister Modi’s vision of Make in India is one of the most ambitious programs of the new government to promote local manufacturing in the country. The rapid growth of Ecommerce in the country is the perfect engine to accelerate the Make in India campaign. It has pushed the growth of small and medium enterprises by negating the need for physical infrastructure investments and by cutting down the advertising and promotion costs. This growth can multiply if the local manufacturers are able to sell directly to E-commerce companies that allows economies of scale to kick in. Currently the government has prohibited Ecommerce companies with any foreign investment to follow the inventory led B2C model, thus closing the most beneficial impact of the sector to local manufacturers.

Converging the Make in India, Digital India and Skill India, E-commerce platforms have employed technology to push for the growth and development of local manufacturing. It has sought to customize old logistics services like India Post and given them a new lease of life. Labour intensive sectors like textiles, leather, gems and jewellery making have got a new lease of life from the growth of the E-commerce sector with many small and medium sized manufacturers of unbranded products being able to sell their goods at competitive prices on a much wider platform. With new trends and fashion design emerging, most of the youth from tier 2 and 3 towns are able to acquire the requisite skills and get employment in these factories.

Commending the Make in India campaign of the current government Mr. Bikky Khosla, Chairman, Ecommerce Committee, ASSOCHAM said, “Over the last 2 to 3 years, the E-commerce sector has contributed the maximum growth and manufacturing, especially SMEs in the country have been the direct beneficiaries of this growth trajectory. This is the case when only half of the sector (B2B) is allowed to operate freely. In the scenario of the entire sector (both B2B and B2C) being liberalized the Ecommerce industry would become one of the transforming agents for local manufacturing in the country. By enabling Ecommerce companies with foreign investments to source directly from the local manufacturers, the latter would be able to benefit from global inventory technology and supply chain practices. Their focus would shift from being a seller to becoming a global quality manufacturer of products.”

 

Nasir Jamal, Secretary General, eCommerce Association of India (ECAI) said,“Make in India is one of the most ambitious program of PM Modi which will transform local manufacturing in the country. In a short period of time Ecommerce has proved its ability to stimulate local manufacturing especially amongst SMEs/MSMEs. This can gain further traction if the government liberalizes the sector by enabling inventory led   Ecommerce. The Ecommerce companies would be able to source in bulk from the local manufacturers and avail of their benefits in inventory and supply chain practices”.

Anupam Gupta, Convener – IT, All India MSME Association (AIMA) said, “Ecommerce is spurring the growth of Small Industries in the country and with the right impetus given by the Make in India campaign, it could further transform the development of manufacturing by small and medium enterprises in the country.” He added that it was imperative that the government create the right environment for the E-commerce sector to grow unhindered.

Commenting on the impact of the E-commerce sector on the small manufacturers, Ashish Kumar, of Sukhpal Prints, a vendor from Rajasthan who supplies hand block printed apparels to e-commerce portal Shopatplaces.com said, “E-commerce has dramatically expanded our market. From an earlier situation where limited market size and sustainability were key challenges, the advent of Ecommerce has led to substantial double-digit growth based on increased volumes and year around demand. However this sometimes gets restricted as many sites with foreign funding have restrictions on sourcing from us in bulk and prefer that we directly sell to the customer as a seller. This is always not possible as we are still quite small and unable to scale up so fast. We hope that the government quickly liberalizes the sector otherwise our growth will remain quite stagnant.”