This Article is From Sep 27, 2021

Amazon's Statement Amid Controversy Over "East India Company 2.0" Barb

Earlier, the front cover of the latest issue of Panchjanya - a RSS-linked magazine - showed Amazon CEO Jeff Bezos and the headline "#Amazon: East India Company 2.0"

Amazon CEO Jeff Bezos is on the cover of Panchjanya's new edition

New Delhi:

Hours after RSS-linked magazine Panchjanya attacked Amazon as "East India Company 2.0" and labelled it a "threat to indigenous entrepreneurship", the e-commerce giant highlighted its "positive impact on small businesses... including sellers, artisans, and delivery and logistics partners".

"During the pandemic three lakh new sellers joined us... of which 75,000 were local neighbourhood shops (dukaans) from 450+ cities (selling) furniture, stationery, consumer electronics, beauty products, mobile phones, garments, medical products..." a statement by the company said Monday.

Amazon also highlighted its export program, which it said had helped over 70,000 Indian businesses - many from smaller cities and towns - sell 'made in India' products across the world.

"Amazon's exports program is witnessing rapid momentum... today there are 70,000+ exporters from metros as well as Tier II, III and IV cities, selling crores of 'made in India' products to customers in 200 countries across the world - truly taking (it) global."

Earlier Panchjanya's Hitesh Shankar tweeted the front cover of the magazine's latest issue - it showed Amazon CEO Jeff Bezos and the headline "#Amazon: East India Company 2.0".

The accompanying tweet referred to allegations Amazon's legal representatives bribed Indian officials, and asked: "What did it (the company) do wrong it needed to bribe... Why do people consider this company a threat to indigenous entrepreneurship, economic freedom and culture?"

Mr Shankar has since released a video statement on the magazine's Twitter account in which he says the report on Amazon's "threat" is "a factual story".

"It is a factual story which we have put before the readers. How did over 40,000 shops close due to one company... How did one company - through so many shadow companies - promote selected brands (that) have captured around 95 per cent of the market..." he said.

"Our Indian culture is for diversity... and it is a vicious cycle to crush that diversity. Our cover story is an attempt to expose this vicious cycle," he declared.

The article has also been backed by the Confederation of All India Traders, or CAIT, which said it "greatly appreciated" the cover story and that it "corroborated" the group's claims that Amazon and Flipkart are "trying to become second edition of East India Company in India".

"... is a matter of fact that business model of these two companies are similar (to) that of East India Company - selling goods at cheaper rate irrespective of the quality... killing competition... and monopolising the market in their favour..." BC Bhartia, CAIT National President, said.

"This is exactly what East India Company did... both Amazon and Flipkart want to invade our country's econom(ic) and social culture..." the CAIT chief declared.


Amazon and Flipkart face a probe by the Competition Commission of India (CCI)

Indian brick-and-mortar retailers have frequently accused Amazon, and rivals Flipkart, of favouring select, usually large-scale, sellers to the disadvantage of smaller businesses and stores.

In August the Supreme Court refused to halt an inquiry into Amazon and Flipkart's business practices, rejecting demands to pause a Competition Commission of India (CCI) probe.

In April, Reuters reported Amazon said it would commit around Rs 1,860 crore to small businesses; this was a day after trader groups representing around six lakh sellers protested a virtual event organised by the company to showcase opportunities to sell online.

A Reuters report published in February revealed Amazon had given preferential treatment to a small group of sellers in India and used them to circumvent strict foreign investment regulations.

Amazon has said it "does not give preferential treatment to any seller on its marketplace".

Amazon also faces bribery allegations in India, after a whistleblower flagged alleged payments linked to more than Rs 8,500 crore paid in legal fees over two financial years.

Last week the government said the charges would be fully investigated.

Amazon has launched an internal inquiry as well.

This is not the first time Panchjanya - which has roots in the RSS, the ruling BJP's ideological mentor, has taken on a corporate giant.

Earlier this month, it lashed out at Infosys - an information technology behemoth widely seen as one of India's biggest success stories in the global business community.

The government and the RSS moved to distance itself from the article; Finance Minister Nirmala Sitharaman called it "not right" and a RSS spokesperson said the magazine "is not a mouthpiece".

With input from Reuters