Editorial: Feet in the fire
The hissing attack against Amazon in Panchjanya, the right-wing, Hindi magazine published by the Rashtriya Swayamsevak Sangh, raises some disturbing questions about how India intends to treat investors who commit a huge amount of funds to this country. The article slammed Amazon’s business practices at its e-commerce platform and went on to accuse it of resorting to shenanigans which were reminiscent of the infamous East India Company. The aggressive attempts to tar legitimate businesses owned by overseas interests are sending out wrong signals at a time when the Narendra Modi government has been assiduously trying to court foreign investment. Some weeks ago, the Union commerce minister, Piyush Goyal, took a sideswipe against the Tatas for opposing his plans to overhaul e-commerce regulations that would place unreasonable restrictions on companies looking to harness technological innovation that could potentially disrupt the country’s retailing landscape.
It is time the government realizes that it cannot have it both ways: it cannot invite investors into the country and then make it extremely difficult for them to operate when they start to chew up competition. The attack against Amazon arose after a whistleblower apparently flagged bribery issues against the company. The accusation stems from excessively high legal fees that were supposedly routed through a bunch of lawyers and used to pay off unnamed officials in return for unspecified favours. If true, this needs to be aggressively investigated and the company as well as the recipients of the bribe must be exposed. This is just the sort of case that ought to have been referred to the Serious Fraud Investigation Office. There is no evidence that the government has initiated such a probe. Instead, the RSS mouthpiece has chosen to grab this opportunity to launch a smear campaign to further its own objectives.
The Modi government has been trying to push a warped Make in India campaign that is designed to create home-grown giants who are being propped up by some egregious policymaking and regulatory high-handedness. Flipkart, Mastercard, WhatsApp, Google, Twitter, Cairn Energy and Vodafone Inc. all have stories to relate about how the system is being manipulated to hurt their interests. Amazon and Flipkart have been slammed for doling out massive discounts to lure customers. But when a reputed, home-grown behemoth muscled its way into the telecom industry a few years ago using similar tactics, nobody in the saffron brigade saw reason to protest. Companies like Cairn Energy, which have been looking to get out of the country for years, have had to wage costly court battles in India and abroad to recover their legitimate dues. Foreign investors have other options they can fruitfully explore. China, for instance, is laying out the red carpet for technology giants who may no longer be prepared to acquiesce to a brutal tax and regulatory regime in this country.