India’s retail sector is at a crossroads, with small traders raising alarms about alleged malpractice by quick commerce platforms like Blinkit, Zepto, and Swiggy Instamart. The Confederation of All India Traders (CAIT) has now escalated the matter, urging Union Commerce Minister Piyush Goyal to act against what it describes as legal and regulatory violations by these platforms.
In a formal letter, CAIT, a national body representing millions of traders, outlined its concerns, accusing these companies of misusing foreign direct investment (FDI) to gain an unfair edge. A recently published white paper by the organization underscores the gravity of the situation, with copies shared with state leaders and central authorities.
Traders Accuse Quick Commerce Platforms of Exploiting FDI
CAIT’s national president, BC Bhartia, has raised serious allegations against quick commerce firms. According to him, these platforms are leveraging FDI funds to undercut traditional retail players, jeopardizing the survival of over 30 million small retailers across India.
“These companies manipulate suppliers, dictate prices, and control inventory,” said Bhartia. “Small grocery stores, the backbone of our economy, are being pushed to the brink by unfair practices.”
The organization highlighted how these platforms utilize steep discounts and exclusive agreements to dominate the market. Bhartia alleged that Rs 54,000 crore raised through FDI had not been channeled into infrastructure development or long-term investments, as intended. Instead, the funds were reportedly used to offset losses and gain market share, creating a highly skewed playing field.
Violations of FDI Policies and Competition Act Highlighted
CAIT Secretary General Praveen Khandelwal echoed these concerns, criticizing quick commerce companies for their alleged disregard of India’s FDI policies and the Competition Act.
“These companies are openly violating rules and destabilizing the retail sector,” Khandelwal remarked. “The Union Commerce Minister himself recently expressed concerns and proposed integrating these platforms with local kirana stores.”
Khandelwal emphasized that these firms often conceal vendor details from consumers, a practice that potentially violates the Competition Act and consumer protection regulations. He revealed that CAIT plans to organize a delegation to meet with Goyal to discuss these issues directly. Additionally, a two-day seminar in Delhi, scheduled for January 6-7, will further address these concerns alongside other trade challenges.
Dark Stores and Exclusive Agreements Under Scrutiny
One of the key issues raised by CAIT is the proliferation of “dark stores” across the country. Bhartia accused quick commerce companies of operating these establishments in violation of regulations that prevent them from setting up retail outlets.
“These dark stores act as retail outlets in disguise, bypassing the law and harming small retailers,” Bhartia said. He also criticized the platforms for forging exclusive agreements with select vendors, effectively sidelining independent retailers.
Calls for Government Oversight and Policy Enforcement
CAIT’s white paper, unveiled last month, urged the government to strengthen oversight of quick commerce platforms. The traders’ body recommended stringent enforcement of consumer protection and e-commerce rules to curb alleged violations.
Bhartia also emphasized that unchecked dominance by these platforms could result in long-term damage to India’s retail landscape. “The government must intervene immediately to ensure these companies adhere to the law,” he said.
As the debate intensifies, the onus is now on policymakers to balance innovation in commerce with safeguarding the interests of millions of small traders. The outcome could define the future of retail in India, a sector deeply intertwined with the country’s economy and social fabric.
