Market Walk

ONDC Launch – This is the right way to trigger healthy competition in India

In the last few months, there have been several complaints about big names like Amazon and Flipkart trying to dominate the digital commerce space by using tactics that were not always palatable. The ONDC is the right way to approach.

Making e-commerce democratic

The ONDC project or the Open Network Digital Commerce, an agnostic platform offered by the government, plans to change the rules of e-commerce in India. Going ahead, ONDC will allow buyers and sellers to transact online through this government-sponsored platform, irrespective of the network or service provider they are registered with. This is likely to come as a major boon to small traders looking for digital identity.

Digital complaints galore

In a way, the online commerce business in India had become a duopoly between Amazon and Flipkart (Wal-Mart owned). They held the keys to the eCommerce world in India. This had led to many allegations like predatory pricing, favours granted to select large sellers, flash sale at discounts etc. The clout of these two online platforms was resulting in the distortion of the competitive spirit that e-commerce platforms were supposed to be all about. The ONDC was conceived to break this monopoly. You can look at this as the UPI money transfer system in India, which is bank agnostic and does not permit any bank to dictate terms.

A formidable project driver

One of the good features of ONDC is that it is being driven by one of the most visionary technology minds and one of the finest project managers. In fact, Nandan Nilekani, apart from being the former CEO of Infosys, was also the brain behind the launch of the Aadhar Identity System, which has had massive applications in financial inclusion in India in the last few years. Nilekani’s idea of having ONDC is to empower the millions of small traders and MSMEs that can now create digital identities to boost their sales and also transact on the web without worrying about the service providers. As ONDC picks up, digital players will adapt and be part of the ecosystem. That is what Nilekani is betting on.

That is the right way

When the government launched UPI and the RuPay system in India, most the people did not give it a chance. It has been a huge success if you go by the numbers. The moral of the story is, that if businesses are trying to monopolize, the answer is to make the market more competitive and democratic with the help of a truly agnostic platform. That is where the government has to take the initiative and that is what the Indian government has done in this case. Even Nandan Nilekani believes this is the right way to handle overweening players who try to stifle competition. Now, ONDC has to pick up and be truly meaningful.

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