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Karnataka All Set To Become 1st Indian State With Ecommerce Policy; Sachin Bansal May Spearhead The Mission

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Online Shopping ECOmmerce  growth 2020

Karnataka, which is home to some of the most renowned Indian startups which have been hailed as ‘Unicorns’ may soon become India’s first state to have a full fledged ecommerce policy. In the absence of such a robust framework pertaining to digital businesses, we have seen trouble arising from various Govt. departments.

This unique ecommerce policy for Karnataka has been proposed by Kiran Mazumdar-Shaw, chairperson and MD of Biocon, which has nothing to do with ecommerce industry as such. But she is concerned about the legal and tax related issues which is hampering all round growth of Karnataka’s unicorn startups.

As per her proposal, Flipkart’s co-founder Sachin Bansal should head the policy making procedure. She said, “Seeing the growing potential in e-commerce, we suggested that a pragmatic and comprehensive policy be developed for the same. We suggest that the government should take the help of private sector figures like Sachin Bansal, who is already a part of the Vision Group. This sector will be a huge investment driver..”

Kiran proposed her suggestions for the betterment of ecommerce industry during a high profile ‘Vision Meeting’ which was chaired by Karnataka Chief Minister Siddaramaiah, R.V. Deshpande, and attended by various state industries ministers, officials and entrepreneurs from various parts of the state which included Infosys founder Narayana Murthy.

We have already reported that Sachin Bansal is trying to create a special lobby of ecommerce startups and established firms which can negotiate with the Govt. for creating a better eco-system for the digital economy.

Karnataka’s Tryst With Digital Economy

Ever since the wave of ecommerce and Internet based businesses engulfed our nation, Karnataka has been in the midst of intense struggle between the startups and regulations; entrepreneurial dare and ambitious tax issue.

In 2014, tax authorities started seizing Amazon’s products on the allegation of tax related disputes, which clearly sent a wrong signal to the world. Only after the State Govt. asked tax authorities to relax with some undefined rules, that Amazon has been able to carry on their business from their headquarters in Bengaluru.

Earlier this year, Karnataka’s traffic officials started seizing Uber and Ola’s newest offering: rented bikes on account of violating years of traffic rules. In between, they even asked Uber and Ola to immediately suspend their operations.

In order to resolve this issue, Karnataka formed a special policy framework for ‘on-demand taxis’ and granted Ola their first ever license to operate.

But ambiguity still exists related to regulations, state taxes on ecommerce shopping and other legal and administrative loopholes which are stopping new startups from expanding.

In case Karnataka is able to formulate a framework for ecommerce industry, in the guidance of Sachin Bansal and other ecommerce stalwarts, then it may set a precedence for other states as well.

Source: 1, 2

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