CAIT Will Take Legal Action Against Walmart-Flipkart Deal; Softbank’s Position Still Dicey!
Walmart-Flipkart deal would be legally opposed by CAIT now!
Offline traders are still not able to accept the fact that world’s largest retailer has acquired India’s largest ecommerce portal.
It seems that a bitter legal battle is about to be launched against Walmart-Flipkart deal, led by CAIT.
Meanwhile, Softbank’s position in this whole deal is still dicey.
But Walmart is ‘chill’.
CAIT: We Will Take Legal Action Against Walmart-Flipkart
Influential traders’ lobby: The Confederation of All India Trader or CAIT has been quite vocal against the Walmart-Flipkart deal.
Infact, they had been opposing the very concept of ecommerce since long, and thus, their recent opposition to Walmart-Flipkart is not that suprising.
But, there is a twist now.
CAIT has announced that they will now take legal route to stop this deal from materializing.
In a strong statement, CAIT said, “CAIT has decided to challenge Walmart Flipkart deal since the deal is circumventing laws and will offend FDI policy once it is implemented and will create an uneven level playing field beside accomplishing hidden agenda of Walmart to reach out to offline trade through e-commerce way.”
In fact, as you read this post, lawyers and legal experts from CAIT are discussing ways to challenge this deal, and will certainly try to discover loopholes in the FDI related laws.
Walmart has responded positively, saying that their deal with Flipkart will help the Indian retail sector, and new jobs shall be generated.
Walmart India Chief Corporate Affairs Officer Rajneesh Kumar said, “The partnership (with Flipkart) will create millions of jobs through development of supply chains, direct farm procurement will help in increasing farmers income and take forward government’s vision of ‘Make in India’ initiative and supporting SMEs, among others.”
Earlier, we had reported that Walmart will generate 1 crore new jobs in India.
CAIT Secretary General Praveen Khandelwal has said that Govt. should put this deal on hold, and create a national ecommerce policy first, to handle such issues.
He alleged that Walmart can misuse ‘data’ of Indians.
He said, “Whoever controls the platform, controls data and digital intelligence. Therefore, being the controller of the Company, Walmart may use the data and other information as per its will and wish and the possibility of compromising the data can not be ruled out.”
It seems that battle between CAIT and Walmart-Flipkart would be now fought in the Court room.
Softbank’s Position Still Dicey?
Softbank, one of the major investors in Flipkart, had earlier announced their exit during Walmart’s acquisition.
We had reported that against their investment of $2.5 billion, Softbank will get $4 billion, which is a ROI of 60%.
But it seems that this ROI isn’t enough.
Softbank’s Chief Executive Masayoshi Son has said, “We are considering many options,”
In response, Walmart is chill about this whole case.
As per some insider sources, Walmart is ok if Softbank decides not to exit, and wait for some more time to take a decision.
What exactly is Softbank’s intentions here? Are they seeking more returns?
Do share your opinions, and views by commenting right here!