E-Commerce Policy In India



  • GS Mains paper III
  • E-commerce sector in India
  • National policy for E-commerce
  • International trade, online trade



  • India is planning a national e-commerce policy to support exports and protect consumer interests.


  • Electronic commerce or E-commerce is expanding as a means to doing business at a very rapid rate.
  • It also involves using all round electronic methods and procedures to conduct business activities to achieve the organizational goal.
  • Electronic Commerce provides new opportunities for all overseas firms to access India’s domestic market and vice versa.
  • Every service and information about the product is available just on a mouse click on computers.
  • The rise of this new medium is attracting attention by both private and public sector in order to remain upgraded and competitive so as to give 100 per cent services to their customers efficiently and effectively.


Upcoming national e-commerce policy

  • Ministry of Electronics and Information Technology (MeitY) is working on a proper national comprehensive policy on e-commerce to be put in public domain for discussions.
  • Inputs from the feedback could form the basis for a national e-commerce policy.
  • India would also engage in discussions with other developing nations on the issue for support for its standing and relevant inputs.


Current guidelines regarding E-commerce

  • Indian Information Technology Act and E-commerce:
    • Indian Information Technology (IT) Act gives legal recognition to electronics records and electronic signature.
    • This is a step to facilitate paper less trading.
    • This act also provides for reasonable security practices and procedures and sensitive personal data or information.
  • Section 72A of IT Amendment Act, 2008:
    • It provides for punishment for disclosure of information in breach of a lawful contract is laid down.
  • FDI guidelines for e-commerce by DIPP:
    • DIPP has issued guidelines for FDI in e-commerce.
    • In India 100% FDI has been permitted in B2B e-commerce recently.
    • As per these new guidelines on FDI in e-commerce, 100% FDI under automatic route is permitted in marketplace model of e-commerce, while FDI is not permitted in inventory based model of e-commerce.
  • Others:
    • E-commerce has become an important part of many multilateral negotiations such as Regional Comprehensive Economic Partnership (RCEP), WTO, BRICS etc.
    • Ministry of Electronics & Information Technology is leading such negotiations on e-commerce from Indian side.

Global e-com market

  • Global e-commerce market is estimated at $25 trillion of which:
    • 5% – trans-border component
    • 95% – domestic e-commerce trade
  • The size of the Indian e-commerce market is just $30 billion.
  • National policy for e-commerce for India is complicated as many issues are interlinked.
  • Therefore different departments the Government are trying to address the issues pertaining to their domain to help in formulate an overarching national policy for e-commerce.


Why India is skeptical about International rules

  • Several countries want to negotiate multilateral rules to govern international trade through e-commerce.
  • India does not want to start negotiations on World Trade Organisation (WTO) rules in e-commerce.
  • India is still unclear how International rules would benefit developing nations, including their companies and consumers.
  • India needs to study whether the obligations under International treaties would bind its stakeholders to a benefit or loss.
  • The key areas which India needs to look at include:
    • data flows
    • server and data localization
    • transfer of technology
    • mandatory sharing of telecom infrastructure



  • Several nations are in favour of continuing in line with the Work Programme on E-Commerce approved in 1998.
  • India is looking out for a balanced approach at both the WTO and Regional Comprehensive Economic Partnership (RCEP) negotiations while balancing its national interests.


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