India is all for reselling used phones—as long as they’re not coming in from other countries.
India’s Environment Ministry issued “show cause” notices to Amazon $AMZN, Snapdeal, OLX, eBay, and a slew of other e-commerce sites for selling refurbished phones from abroad, giving them all 15 days to justify why the government shouldn’t take action against them. (The notice was sent on Sept. 23.) The companies have been accused of violating an Environmental Protection Act, which was revised in March this year to bar the import and sale of used electronic goods in the Indian market.
“We are compliant and will always remain compliant with local laws,” an Amazon India spokesperson told Quartz, adding that goods are all sold by third party sellers in the online marketplace. “However, we have noted the concerns flagged by the Ministry of Environment and are conducting a detailed evaluation, working closely with our sellers, partners and the government to ensure our committed to compliance continues.”
The country produces nearly 1.8 million tons of electronic waste every year, a number that is set to nearly double by 2018, according to the Associated Chambers of Commerce & Industry of India (ASSOCHAM). With the growing heap of domestic e-waste, the government is wary about letting foreign countries dump their electronic products as well. Only 1.5% of India’s total e-waste gets recycled due to “poor infrastructure, legislation and framework,” ASSOCHAM noted in a June 2016 report. And phones are hazardous because they contain high levels of lead, mercury, and cadmium, and they are discarded more often because of their short lifespans.
In May this year, India shut down Apple $AAPL’s plans to sell refurbished phones in the country. iPhones, which have a steep price tag that doesn’t go down well with a price-sensitive market like India, have failed repeatedly to compete with the plethora of low-cost alternatives. The unfavorable decision buried Apple’s hopes of launching cheaper second-hand phones.
Amazon said in June that it would invest $3 billion in its Indian arm, and recently went on a Bollywood-content spree for Prime Video. It’s not surprising that Jeff Bezos’s company also wanted a slice of India’s booming used goods market, estimated to be valued at Rs 1,15,000 crores ($17 billion) in 2015. A company can bring in refurbished goods for retail purposes only with prior permission from the government. But if it circumvents the law, it can be subject to a five year jail term or a Rs 1 lakh ($1,500) fine, or both.
