Parmjit Singh, head of the India business group at Eversheds, has commented following predictions that India is likely to ease restrictions for foreign online retailers.
He said: ‘The news that the new Indian government is likely to ease restrictions for foreign online retailers will be welcomed by major online retailers, but will cause concerns for the major brick retailers. The new government, when in opposition, opposed opening up multi-brand retail to foreign retailers and since being elected has not indicated any change in its stance.
‘The new prime minister is keen to encourage foreign investment but not by harming local Indian businesses. The opening up of online to foreign retailers will not threaten the traditional mom and pop stores in India but will positively benefit small Indian manufacturers.
‘E-commerce is growing rapidly in India. Recently a $2bn (£1.1bn) e-commerce giant was created in India when Flipkart, India’s largest e-commerce company, acquired rival Myntra. By opening up online retailing, the government may be shutting the door on allowing foreign retailers to open multi-brand stores in India.’