Nandan Nilekani will be protecting Indian Retail from Amazon and Walmart
Nandan Nilekani co-based software program powerhouse Infosys Ltd., have become a billionaire and went directly to spearhead a massive authorities application to create a biometric identity for India`s nearly of four billion people.
Now 66, Nandan Nilekani has one extra formidable goal. The high-profile magnate is supporting Prime Minister Narendra Modi’s construction of an open generation community that seeks to degree the gambling area for small traders withinside the USA`s fragmented however fast-growing $1 trillion retail marketplaces.
Its said reason is to create a freely handy online machine wherein buyers and customers can purchase and promote the whole lot from 23-cent detergent bars to $1,800 airline tickets.
But its unstated goal is to sooner or later cut back the powers of Amazon.com Inc. and Walmart Inc.-owned Flipkart, whose online domination has alarmed small traders and the hundreds of thousands of neighborhood mom-and-pop stores, known as Kirana, that shape the nation`s retail backbone.
As the 2 worldwide giants poured a combined $24 billion into India and captured 80% of the net retail marketplace with competitive reductions and promotion of desired dealers, the Kirana stores are frightened of an unsure future.
Despite online trade accounting for pretty much 6% of the general retail marketplace, they’re hectic they may be sooner or later snuffed out, assembling a destiny just like many family-owned groups withinside the U.S. and elsewhere.
The not-for-earnings machine, which is going with the aid of using the unwieldy call of Open Network for Digital Commerce, or ONDC, seeks to deal with the concerns of the one.
Never tried everywhere else, its goal is to permit small traders and outlets to plugin and benefit from the attain and economies of scale of giants.
Essentially, the authorities might create their very own e-trade environment for everyone, designed to loosen the stranglehold of businesses like Amazon that dictate which manufacturers get entry to top customers and on what terms.
“It`s a concept whose time has come,” Nilekani stated these days in communication at his non-public workplace withinside the Billionaire`s Row place of Koramangala in Bangalore, domestic to a number of the nation`s pinnacle tech tycoons.
The hundreds of thousands of small business owners owe it to the industry to provide them with a smooth way to participate in the new high-boom place of digital commerce.
A pilot of the not-for-earnings, authorities-run community is about to be rolled out in subsequent months to choose customers in 5 cities. Lenders together with ICICI Bank Ltd. and state-owned Punjab National Bank and State Bank of India have offered stakes withinside the entity.
A spokesman for Amazon stated they`re seeking to higher apprehend the version to look if the Seattle-primarily based totally enterprise has a position to play. Flipkart didn`t reply to a request looking for comment.
India has to turn out to be a battlefield for a few worldwide retail behemoths which are both closed out of China or are suffering to compete with neighbourhood competitors there.
With nearly 800 million telephone customers, the sheer length and capability have become the South Asian USA into a perfect trying out floor for plenty of businesses, together with Google, Meta Platforms Inc. and homegrown giants together with billionaire Mukesh Ambani`s Reliance Industries Ltd.
In his previous avatars, Nilekani helped the government develop the Aadhar biometric identification system, the digital equivalent of the US Social Security program. For most Indians, this is the first proof of their existence.
In addition to reducing fraud, authorities say this also ensures that social benefits reach the right recipients. Nilekani also introduced the United Payment Interface (UPI), which is a backbone for electronic payments used by Google and WhatsApp, it surpassed 5 billion transactions last month.
Hired as an ONDC consultant last summer, the salt-and-pepper tech king wants to do for e-commerce what UPI did for digital payments. But his biggest challenge is making sure the network achieves its goals. The Amazon and Flipkart platforms dominate the market because of their proven technologies that attract both merchants and shoppers.
Anil Kumar, CEO of Redseer Management Consulting Pvt, said the government needs to build something comparable – or better – if it is to outperform mainstream e-commerce platforms. payment logistics and warehousing service providers, etc. Bangalore-based Kumar said.
The challenge is to standardize and streamline the experience for both buyers and sellers, such as the return and refund process, to create an open network that everyone can benefit from.”
Nilekani will also be under pressure to avoid the controversies that have plagued his previous projects. Aadhar has been placed under a cloud on issues related to privacy, security and data identity.
India’s Supreme Court is currently hearing a UPI-related case, after a lawmaker accused Amazon, Google and WhatsApp’s Meta of engaging the system without undue scrutiny and allegedly violating the law. break the rules.
If successful, the e-commerce network could help millions of small businesses stay connected and worry less about global giants.
Among those wanting to try it out is Kauser Cheruvanthody, 42, one of the owners of a chain of five baby stores in Bangalore. He has never sold online, but the 30% drop in sales during the pandemic came as a shock. “ONDC can be a game-changer,” says Cheruvanthody. “I’m ready to fight Amazon and others, discount to get discount.”
The challenges Nilekani faces are what make him the right man for the job, according to Hemant Taneja, managing partner of Palo Alto-based venture capital firm General Catalyst.
“Nandan is known for playing the long game, building systems of sustainable change with very intentional thinking about which part of the economy should be a digital public good and which part should be a digital public good,” said Taneja. Which should be guided by capitalism.
Entrepreneurs like Kumar Vembu are excited about the potential of open models. His startup GoFrugal provides business software to over 30,000 small retailers and quick-service restaurants.
He is currently helping hundreds of people integrate into the new network. “Previously, a small retailer brought a knife to the shooting,” Bembu said. ” Now that we have the proper equipment, we can compete with them properly.”
Thampy Koshy, CEO of Ernst & Young’s former senior partner, said the open network is targeting 100 cities in the coming months.
Aadhar took nine years to reach 1 billion people on the platform, while UPI took five years to reach 4 billion transactions per month.
Nilekani said he is optimistic that ONDC will be deployed much sooner as India has been on this path before. ” Our mission is to change the rules of e-commerce games, so we are planning a new course of action.”, he said. – Bloomberg
India will launch an open network of digital commerce (ONDC) on Friday as the government seeks to end control of U.S. companies Amazon.com and Walmart in the fast-growing e-commerce market, according to government documents.
It’s a schedule. The launch of the platform will take place on Thursday after Indian antitrust regulators have attacked Amazon’s domestic sellers and some Wal-Mart Flipkart on allegations of competition law violations. Both companies did not respond to requests for comment on the attack.
Indian retailers, key supporters of Prime Minister Narendra Modi, have long argued that the Amazon and Flipkart platforms are benefiting some big sellers through predatory pricing, for both companies. States that it complies with all Indian laws.
The government’s so-called ONDC platform allows buyers and sellers to connect and trade online, regardless of the other applications they are using. The Commerce Department told Reuters that it will be expanded after its soft launch on Friday.
According to government documents, two large multinationals dominate more than half of the country’s e-commerce, restricting access to markets, giving preferential treatment to some sellers and squeezing supplier profits. bottom.
The company was not nominated. Regarding the ONDC, I would like to make the following comments: Amazon and Flipkart failed to respond immediately. According to the document, India’s ONDC program aims to involve 30 million sellers and 10 million merchants online. Toward the end of August, there should be 100 towns and cities covered. According to the project documentation, it focuses on local language apps for buyers and sellers, especially for small traders and local consumers.
According to the government, the plan already has the support of retailers and venture capitalists. Lenders such as State Bank of India, ICICI Bank and Bank of Baroda have promised to invest Rs 2.55 billion (the US $ 33.26 million) in ONDC. For years, the company has given incentives to a small group of sellers on the platform and used them to circumvent Indian law, according to a Reuters survey last year based on Amazon’s internal documents. Amazon denies cheating.
edited and proofread by nikita sharma
