Amazon India, Flipkart, and Snapdeal Tread Lightly

In India, you can’t buy anything directly from Amazon.com. To protect local merchants, the government bars companies that have taken foreign investment from acting as retailers online. Instead, Amazon India functions as an online bazaar, more like EBay or Alibaba. So do the country’s other industry leaders, Flipkart and Snapdeal.com, which are homegrown but have received foreign capital.

Still, small Indian retailers complain that Amazon, Flipkart, and Snapdeal can exercise a level of control over products that breaks the law by limiting choices and organizing flash sales, often compensating chosen merchants who agree to slash prices. For certain products the sites feature items from just a few retailers. Recent sales indicate “some element of control and direct interference in the business of these vendors,” says Praveen Khandelwal, national secretary general for the Confederation of All India Traders, adding that the marketplace model “is just a mask.”