The Trump administration is putting pressure on India to grant full access to its $125bn ecommerce market to online retailers like Amazon and Walmart as part of a trade deal negotiation. The US is seeking a level playing field in ecommerce in talks with Prime Minister Narendra Modi’s government, covering various sectors from food to cars.
Vice-president JD Vance recently met with Modi in New Delhi to discuss the progress of the trade agreement negotiations. The US is looking to address the 26% tariff on Indian exports to the US, with President Trump temporarily pausing the measure for negotiations to take place.
Amazon CEO Jeff Bezos and Walmart CEO Doug McMillon have been actively involved in discussions with the Trump administration regarding India’s barriers against foreign ecommerce companies. Walmart, which owns Indian online retailer Flipkart, has been particularly vocal about the issue.
The push to open up India’s retail market has put Bezos and McMillon against Mukesh Ambani, Asia’s richest man, whose Reliance group is India’s largest retailer. India currently only allows US ecommerce companies to operate as online marketplaces, while Indian competitors can produce, own, and sell goods through their platforms, creating what the US considers non-tariff barriers.
The Trump administration has been coordinating closely with US ecommerce platforms during negotiations, with industry executives revealing that US retailers have faced challenges such as product inspections by the Bureau of Indian Standards. Despite these hurdles, the US is determined to gain greater access to India’s booming ecommerce market.
Praveen Khandelwal, secretary-general of the Confederation of All India Traders, has expressed concerns about the potential impact of opening up India’s ecommerce sector to American giants, emphasizing the importance of protecting India’s retail ecosystem and small traders.
As discussions continue, it is clear that both the US and India are looking to enhance their trade relationship and boost bilateral trade. Amazon and Walmart are eager to expand their presence in India, with Amazon gradually gaining traction but still behind local competitor Flipkart in terms of daily active users.
The ongoing negotiations highlight the complex dynamics of international trade and the challenges faced by global ecommerce players seeking to expand into new markets. As the US and India navigate these discussions, the outcome will have significant implications for the future of ecommerce in one of the world’s largest consumer markets.
