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Old 6th January 2019, 11:47   #1
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Default Government to clamp down on orders from Ali Express & other Chinese websites

https://m.gadgetsnow.com/slideshows/...cms?frmapp=yes

Just read this news about Ali express, Clubfactory & other Chinese e-commerce spaces. In a nutshell, the government is planning a clampdown on shipments from these e-commerce websites. The move comes after protests from Indian sellers facing stiff competition from their counterparts on Chinese platforms.
With this clamp down, at the very best, the Indian government may hike custom duties or cancel the"gift" clause for imports from China. At the very worst, it may totally ban imports from these marketplaces. I know many BHPians are regular users of Ali Express & this is bound to affect them. Even many of the auto vendors dealing with aftermarket accessories, modifications etc will get affected negatively by this.

The second big development in e-commerces (which all of us would be aware by now) is the change in rules which affects their business model. No more highly discounted prices, no exclusive deals with brands, no unfair advantage to own labels by way of free shipping/promotions & restricted stocking of the same on their (e-commerces') platform. Again, this is in wake of complaints from traders' associations & bodies about losing business due to these e-commerce marketplaces.

I understand that the brick-&-mortar stores have to generate profits & stay in business, however I doubt how much of these change in rules for e-commerces will help the former. The e-commerce behemoths will definitely find some loophole in the new law & tweak their business model so that things continue as before. What are your thoughts on these?

Speaking purely as a consumer (& Indian), I always want the most value for money deal. So wherever it may be, on the Internet or the local store, I'll go & get it. In the last few years, more often than not, I've got it online due to discounts & free shipping.
The reason these e-commerces can afford to discount so much is because of the seemingly endless infusion of capital from foreign sources. Which brings me to the second part of the discussion - should unlimited capital be allowed to be pumped into a business just for market share & increasing revenues, WITHOUT profits? Flipkart is nearly 12 years old & hasn't had a single quarter in profit, same must be the case with Amazon. I just wonder at the long term business model of these firms. Billions of dollars have been pumped to increase revenue, based on this increased revenue, billions more may be pumped again, however there is no sign of a profit for the foreseeable future. Isn't this just white collar ponzi scheme? Imho, this should be curbed by the government. Limit the amount of capital which can be infused from abroad. This will force the e-commerce marketplaces to alter their pricing to generate profit & thus create a level playing field vis-a-vis brick-&-mortar stores.
Would love to hear your thoughts on these.
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Old 7th January 2019, 13:25   #2
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

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Originally Posted by superbad View Post

Speaking purely as a consumer (& Indian), I always want the most value for money deal. So wherever it may be, on the Internet or the local store, I'll go & get it. In the last few years, more often than not, I've got it online due to discounts & free shipping.
The reason these e-commerces can afford to discount so much is because of the seemingly endless infusion of capital from foreign sources. Which brings me to the second part of the discussion - should unlimited capital be allowed to be pumped into a business just for market share & increasing revenues, WITHOUT profits? Flipkart is nearly 12 years old & hasn't had a single quarter in profit, same must be the case with Amazon. I just wonder at the long term business model of these firms. Billions of dollars have been pumped to increase revenue, based on this increased revenue, billions more may be pumped again, however there is no sign of a profit for the foreseeable future. Isn't this just white collar ponzi scheme? Imho, this should be curbed by the government. Limit the amount of capital which can be infused from abroad. This will force the e-commerce marketplaces to alter their pricing to generate profit & thus create a level playing field vis-a-vis brick-&-mortar stores.
Would love to hear your thoughts on these.
You say you're speaking as a consumer, but the words seem from a business perspective.
As a consumer, I will want the best prices for quality I am buying.
The businesses can handle their profitability. The VCs and the infusers can take care of their money. If its a "ponzi scheme", and they still partake, well that's a case of fools and their money going their own ways. Why should I be paying more, whether online or at a brick and mortar because suddenly one segment of the business finds itself noncompetitive, but still has clout to push for government intervention.
and what of the many ecommerce vendors and even brick and mortar shops that import from these very international sellers?
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Old 7th January 2019, 13:41   #3
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

It appears that Alibaba is also taking action.

https://timesofindia.indiatimes.com/...w/67413284.cms
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Old 7th January 2019, 13:50   #4
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

The government should think what makes people buy from China. As a regular AliExpress shopper, I can say that most of the items I buy from there are not available in India. Even if they are available, most of them are imported from China and sold at huge margins. I'd be stupid to buy it from those retailers and pay 4-5x the cost. In those rare cases where the item sold is manufactured locally, the quality is way inferior to the stuff made in China. We may mock 'Made in China' tag, but they have come a long way and offer high quality stuff at very reasonable prices. The fact that a lot of 'Made in India' stuff is of garbage quality in spite of being more expensive than the Chinese stuff even with much lower labor pay shows that the problem exists in the greed/corruption here. The correct way is to fix the local problem instead of squeezing the tax payers more and more.

I also read that the govt. is trying to 'reform' the local e-commerce companies too because of the crybaby B&M stores. If it wasn't for these e-commerce companies, these scumbags would have continued acting like kings, what with the 'Goods once sold cannot be taken back or exchanged' and 'fixed price, no bargain' kind of arrogant boards. Good luck to the govt. if it thinks that the people can be controlled through these regressive means.

Last edited by theredliner : 7th January 2019 at 13:56.
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Old 7th January 2019, 14:15   #5
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

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Good luck to the govt. if it thinks that the people can be controlled through these regressive means.
But what can we do?

Few of my friends get few consumer goods from aliexpress as those commodities are vert steeply priced or are not available in India [bike parts/car accessories] and I too was sure that aliexpress is one place where we can find what we want. Its bad news for DIY people as well.
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Old 7th January 2019, 14:45   #6
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

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But what can we do?

Few of my friends get few consumer goods from aliexpress as those commodities are vert steeply priced or are not available in India [bike parts/car accessories] and I too was sure that aliexpress is one place where we can find what we want. Its bad news for DIY people as well.
There is no way the govt. is gonna impose a blanket ban on shopping from China. It is just not gonna work when it is betting big on exporting from India. Heck, with all the existing problems, Pakistan still enjoys 'Most Favoured Nation' status when it comes to trade
At worst, the gift clause will be restricted to a few items per year per address. We may have to pay a small amount of duty, but nowhere near the product's original value (you know why). It may discourage some users buying cheap clothes etc., but for people like us buying electronics or automobile parts, there won't be much of an impact IMO.

Last edited by theredliner : 7th January 2019 at 14:51.
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Old 7th January 2019, 14:48   #7
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

Well, I wonder how many of these B&M stores actually provide a valid bill, show their accounts and pay up their taxes. If a company from China is able to sell its products and ship it across for a much cheaper cost than what a company is able to make in India, then Government should actually introspect and see what is going wrong and where, rather than close the door for competition.

Remember License Raj and what it did to the Automotive sector in our country? To the uninitiated, License Raj policy made it mandatory for any foreign Automotive company to have an Indian origin partner to setup a facility or sell its products here. That is why we had Kawasaki-Bajaj, TVS-Suzuki, Hero Honda, etc. And this rule also is the reson behind why Indian automotive sector lived behind closed doors in the 80's and till late 90's with only Ambassador and Padmini cars (apart from our Maruti 800) for a very long time. Only after that archaic rule was abolished did we get Honda, Daewoo, Hyundai and other stronger competition and then the boom occurred!
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Old 7th January 2019, 14:49   #8
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

Technically the government might have the power to curb the items marked as gift, but beyond that, it will be a senseless move in case imports are restricted or so. It is just not practically possible. What I find more stupid is the way the sellers claim they are losing out on business. In reality, they dont have the damn right to import the same stuff from China, slap heavy margins and then resell them to customers here. Their argument of fair trade is only applicable if they manufacture the product here, and then China produces the same product at a cheaper price and flood our market.

If they really curb import, then it will also affect retailers who get their product from the same source. All in all, it will affect people like me who have a steady stream of parcels coming from Ali
But this can be fixed by Aliexpress sellers not marking the item as gift. As it is the small packets are not of high value. Only the bigger parcels marked as gift will attract attention by the customs I feel.
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Old 7th January 2019, 15:04   #9
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

I don't think this is aimed at retail consumers like you and me purchasing an odd object at a time; even if it an imported Rolex or high ticket item, be it original or duplicate.

There are hundreds of sellers providing wholesale options for different products and supply goods; some are finished products; but a vast majority are of interim products / material that can be used to create new products. A fair guess - a lot of these sales are shown as "gifts" with greasing of palms wherever possible; and that's the leakage (of taxes) that the government is interested.

There could be a possibility that tax evasion is not the only issue; this could have a connect to the Make-in-India aspect of the current government; and a crude "solution" to push more of local manufacturing wherever possible.
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Old 7th January 2019, 15:49   #10
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

I don't think the new regulations aim at stopping us from buying legitimately on these sites. From what I read in the papers, it just aims at stopping shipments marked as 'gifts' when they clearly aren't.

Now if we want to debate import duties or changing the existing tax laws, then that's something else entirely. But this 'gift' clause is clearly being misused as per the present tax laws, so I don't see an issue here.
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Old 7th January 2019, 17:06   #11
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

Quote:
Originally Posted by mayankk View Post
You say you're speaking as a consumer, but the words seem from a business perspective.
As a consumer, I will want the best prices for quality I am buying.
I should've put a space between the two paragraphs . I wanted to know from someone who maybe has e-commerce work experience that how they plan on turning their business into a profit, & for how long can the cash inflow continue. This part was purely for discussion. Otherwise while purchasing, even I always think from the consumer point of view.

Quote:
Originally Posted by theredliner View Post
The government should think what makes people buy from China. As a regular AliExpress shopper, I can say that most of the items I buy from there are not available in India. Even if they are available, most of them are imported from China and sold at huge margins. I'd be stupid to buy it from those retailers and pay 4-5x the cost. In those rare cases where the item sold is manufactured locally, the quality is way inferior to the stuff made in China. We may mock 'Made in China' tag, but they have come a long way and offer high quality stuff at very reasonable prices. The fact that a lot of 'Made in India' stuff is of garbage quality in spite of being more expensive than the Chinese stuff even with much lower labor pay shows that the problem exists in the greed/corruption here. The correct way is to fix the local problem instead of squeezing the tax payers more and more.

I also read that the govt. is trying to 'reform' the local e-commerce companies too because of the crybaby B&M stores. If it wasn't for these e-commerce companies, these scumbags would have continued acting like kings, what with the 'Goods once sold cannot be taken back or exchanged' and 'fixed price, no bargain' kind of arrogant boards. Good luck to the govt. if it thinks that the people can be controlled through these regressive means.
True, "made in China" may be mocked but people fail to realise that 80% of the stuff they use, right from the tooth pick to their fancy iPhone, comes from China. And yes, fierce competition with e-commerce marketplaces have forced b&m stores to descend from their high pedestal & improve store experiences, customer service & competitive pricing. Heck, most of them would be sellers themselves on Flipkart & Amazon.
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Old 7th January 2019, 19:27   #12
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Default Re: Government to clamp down on orders from Ali Express & other Chinese websites

I am a very rare online shopper. The last item I bought from Aliexpress was 12 pieces of sliding window locks which prevent sliding windows from opening more than about 6". The item was sold in packs of 4 and the total cost of 3 packs was about Rs. 1800/-. Amazon had a similar product selling with even the pictures same as Aliexpress where each piece was about Rs. 1500/-.
I understand that the Govt feels that if I had bought 12 pieces for Rs. 1500/- at a total cost of Rs. 18000/-, I would have paid a GST of Rs. 3240/-. All very good, but why should I pay so much? Will this not lead to a black market? Similar to Pakistani petrol available in Gujrat for much cheaper costs, or liquor available with bootleggers, or the many small shops in all towns selling loose groceries at a cheaper price?
Going back to license raj, as @aravind.anand mentioned, those were times when a second hand automobile was more expensive than a new one because booking and delivery of a new vehicle would take 10-15 years. God help us.
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