Indian internet companies have finished 2018 strongly despite the tightening of e-commerce laws by the Modi administration looming large. Overall funds raised by internet companies increased to US$8.4 billion in 2018, up from US$7.5 billion in the previous year, according to data from Jefferies published by Quartz India
. The number of funding rounds over US$100 million has also increased to 17 up from 9 in the same time period.
But observers are concerned that growth figures might not remain this robust. While restrictions on e-commerce
have been in place for some time, forbidding non-Indian companies to hold inventory or sell and ship directly to customers without a domestic partner, the new restrictions are even tougher. Partners of overseas companies now cannot work exclusively with one partner anymore, but instead can have only 25 percent of their inventory controlled by a single foreign entity.
According to the Financial Times, affiliate sellers control over 80 percent of the Indian e-commerce market. It’s not only American companies like Walmart and Amazon who are heavily involved, but also Chinese big players like Alibaba and Tencent.