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Shopee Will Send Shockwaves Among Offline Traders, If Enters India: CAIT

The CAIT in an official statement said that Shopee is owned and controlled by the Chinese people and it will send shock waves via the offline traders' community which have not recovered from the unfair trade practices adopted by foreign-funded e-commerce companies.

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The Confederation of All India Traders (CAIT) on Thursday, in a written letter to Prime Minister Narendra Modi, has requested him to take a look into the Chinese e-commerce application Shopee in India. 

The CAIT in an official statement said that Shopee is owned and controlled by the Chinese people and it will send shock waves via the offline traders' community which have not recovered from the unfair trade practices adopted by foreign-funded e-commerce companies.

CAIT National President B.C.Bhartia and General Secretary Praveen Khandelwal in a joint statement said, "SEA Holdings (the holding company of Shopee) has significant ownership (almost 25 per cent) by Tencent (a known Chinese investment firm). Also, the Founder of SEA, Forrest Li is originally Chinese but became a naturalized Singaporean only a few years back. SEA uses Tencent cloud to store data. Also, SEA’s gaming subsidiary, Garena licenses most games from Tencent leading to huge royalties and the investment ensures that there is significant control and access to data."

The copies of the letter were sent to Prime Minister Narendra Modi, Home Minister Amit Shah, Defence Minister Rajnath Singh, Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal, Women and Child Development Minister Smriti Irani, and Minister for Electronics and Technology Ashwini Vaishnav.

There has been significant recent news-flow around Chinese government entities taking equity stakes and board seats in big Chinese internet companies like Bytedance (parent company of Tiktok which has been banned in India) and Ant Financial (sister concern of Alibaba). There is a real possibility that the Chinese government will do something similar in other companies like Tencent bringing companies like SEA under the direct influence of the Chinese government-said both the leaders, the official press release stated. 

"While the trading community is still recovering from the unfair trade practices adopted by foreign-funded e-commerce companies, the entry of yet another foreign e-commerce player in this segment will only send shock waves through the entire offline trading community. Preferential treatment to favoured sellers, private labelling, unfair and anti-competitive business models with big-ticket manufacturers, deep discounting and flash sales have become the mainstay of these e-commerce platforms and it is highly unlikely that small traders can consistently withstand these continuous assaults from such foreign e-commerce companies. Shopee’s entry into India only means furthering these unfair trade practices," they added.    

Meanwhile, the CAIT has demanded that the government should re-examine foreign applications and their entries in light of their indirect Chinese connections. Brands entering India, with acknowledged Chinese investor backing, need to be asked for an explanation on the structures they have adopted to circumvent PN3. These structures need to be examined in light of the spirit of PN3 to see if they pass the litmus test.


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Shopee Offline Traders india PM Modi cait