Walmart-owned online retailer Flipkart has told the central government that if the six months’ time is not given to follow the new rules of FDI, then the company’s customers have a big risk of breakdown. A source has given this information to Reuters.
New rules for FDI are going to come into effect from February 1, in which e-companies will not be able to sell the goods of those companies on their platform, in which they have a stake. Also, exclusive sales on one of the online platforms will also be stopped.
One source said that in the letter written to India’s Department of Industry earlier this month, Flipkart CEO Kalyan Krishnamurthy said that the company needs to closely assess the rules for the operation of its business.
Krishnamurthy said in the letter, “To ensure compliance with the rules, we will have to make countless changes in our technology system and we will need to put huge resources to do all this in such a short time.” The new rules of FDI were announced on December 26.
He also said that if the deadline for compliance with the rules has not been increased, then there is a risk of breaking down customers in huge numbers. Krishnamurthy has asked to increase the compliance of the new rules by six months.
Walmart, which has invested $ 16 billion in Flipkart, and a $ 5.5 billion investment in Flipkart, has been a major setback for the new rules of FDI.
While expressing concern over the issue at the beginning of this month, the US government has urged Indian officials to safeguard the interests of Walmart and Amazon, cautious about the good relations between the two countries.