India's Financial Crime Probe into E-Commerce Giants: Unpacking the Smartphone Connection

India's financial crime agency is requesting sales data from smartphone companies like Apple and Xiaomi as part of an investigation into Amazon and Flipkart, examining potential violations of e-commerce regulations. This scrutiny occurs amidst trade negotiation talks between India and the United States.

India's financial crime agency is intensifying its investigation into e-commerce giants Amazon and Walmart-owned Flipkart by requesting sales data from smartphone companies such as Apple and Xiaomi. This move is part of an ongoing probe into whether these companies have violated Indian e-commerce regulations, according to sources familiar with the matter.

The investigation comes at a time when India and the United States are nearing a trade deal, with e-commerce regulations a focal point in negotiations. Indian laws prevent foreign e-commerce platforms from exerting control over inventory, limiting their role to merely connecting buyers and sellers. Sources indicate the authorities are scrutinizing whether Amazon and Flipkart have adhered to these regulations.

While small Indian traders allege unfair practices by these e-commerce firms, the companies maintain compliance with Indian laws. The Enforcement Directorate's inquiries could lead to financial penalties if wrongdoing is found. Meanwhile, India's e-retail market is projected to grow significantly, posing additional challenges and opportunities for stakeholders.

(With inputs from agencies.)