Millions of Indian traders are taking to the streets to protest the Flipkart-Walmart deal

Making noise.
Making noise.
Image: Reuters/Daniel Becerril/File Photo
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India’s small traders are mounting their biggest offensive yet against Walmart’s $16 billion (Rs1,00,000 crore) takeover of Indian e-commerce giant Flipkart.

Around a million of them are expected to protest across dozens of cities today (June 02) against what they see as the American giant’s backdoor entry into the Indian retail market.

The protesters fear the deal will skew the field against them. Up to 90% of India’s $670 billion retail trade happens through small mom-pop stores that routinely service households. The deal, meanwhile, is awaiting government approval and Walmart hopes to close it by the end of 2018.

“Today it is Walmart and tomorrow it may be Amazon or Alibaba who can follow this path with the result that retail trade will restrict to few hands,” the Confederation of All India Traders (CAIT) said in a statement

In New Delhi, the protest was scheduled for 11 am to 1 pm, in the busy Karol Bagh market, CAIT representative Praveen Khandelwal told Quartz. The trade body has mobilised such protests in over 1,000 locations across the country.

Earlier in May, CAIT had filed an anti-trust petition with the Competition Commission of India (CCI) objecting to the deal. Besides “unfair competition,” CAIT expressed fears of “predatory pricing, deep discounts, and loss funding” in its petition.

Hidden agenda

Walmart has not shared any plans yet to open stores via Flipkart, but traders see a “hidden agenda” behind its acquisition of Flipkart.

“The Walmart-Flipkart deal will prove to be one step further in capturing the retail trade through the passage of e-commerce,” CAIT said in its statement.

Back in 2007, too, Walmart faced such resistance when it announced plans to open cash-and-carry stores here. A decade later, it still operates only 20 wholesale stores here. It has been unable to open its large-format stores due to the country’s restrictive policies. However, India does allow foreign direct investment in the e-commerce marketplace model.

Rajneesh Kumar, senior vice-president and spokesperson for Walmart India, said:

In line with government’s FDI policy allowing 100% FDI under automatic route in marketplace e-commerce model, our partnership with Flipkart will provide thousands of local suppliers and manufacturers access to consumers through the marketplace model. This partnership will support SME suppliers, farmers in the country to get access to the market through this platform and boost local manufacturing in India.

Some analysts, however, reckon that the CAIT’s fears and concerns are largely misplaced.

“I have spoken to the Walmart representatives multiple times and they speak about the shared-value concept they have and how they’re investing in mom-and-pop-stores,” Sanchit Vir Gogia, chief analyst and CEO at Greyhound Research, told Quartz during an earlier interview. “What the trader’s associations do is they go on hearsay rather than facts. The fact is that (Walmart) plans to use mom-and-pop stores as part of their plans.”

But the traders’ body is not buying any of it.

Besides today’s protests, trade bodies have been discussing several other ways to stop the deal from getting through; this includes making recommendations to the government.