NEW DELHI | BENGALURU: Walmart chief executive Doug McMillon has written to Prime Minister Narendra Modi , seeking certainty and predictability in India’s business environment, people familiar with the matter said.Changes in foreign direct investment rules for ecommerce marketplaces late last year had upset Walmart-owned Flipkart and rival Amazon, and forced them to overhaul their business models. Walmart was particularly disappointed because the changes had come just months after it paid $16 billion to acquire Flipkart. Last week, commerce minister Piyush Goyal said the government was probing Flipkart and Amazon for any predatory pricing.This has come as a new setback for the two companies that were already uncomfortable about the changes in regulations.In December, India put a 25% cap on the amount of goods that an affiliate of a foreign-owned marketplace can supply to any independent seller on the platform. The ruling was put into effect soon after Walmart bought Flipkart.Prior to that, preferred sellers had accounted for a major chunk of the merchandises sold on the marketplaces of both Flipkart and Amazon. Also, Flipkart’s preferred sellers, code-named Alpha Sellers, used to virtually source their entire merchandise from Flipkart's wholesale business prior to the changes in FDI rules that kicked in February.In March, Walmart said an investor in India should expect rule changes, although it was disappointing that they happened so quickly after acquiring Flipkart.“We will have legislation changes; we know that and you work your way through it.

Source: Economic Times October 22, 2019 02:03 UTC