Open Network for Digital Commerce (ONDC)

Open Network for Digital Commerce (ONDC) is globally first-of-its-kind initiative that aims to democratise Digital Commerce, moving it from a platform-centric model to an open-network. As UPI is to the digital payment domain, ONDC is to  e-commerce in India. ONDC will enable, buyers and sellers to be digitally visible and transact through an open network, no matter which platform/application they use. ONDC will empower merchants and consumers by breaking silos to form a single network to drive innovation and scale, transforming all businesses from retail goods, food to mobility.

ONDC will take all measures to ensure confidentiality & privacy of data in the network

  • ONDC shall not mandate sharing of any transaction-level data by participants  with ONDC
  • ONDC will work with its participants to publish anonymised aggregate metrics on network performance without compromising on confidentiality and privacy
  • ONDC will be compliant with the Information Technology Act, 2000 and designed for compliance with the emerging Personal Data Protection Bill.
  • In addition to establishing ONDC to manage the Open Network the Government may consider establishing an Independent Regulatory Authority for eCommerce

Under National Retail Trade Policy the Department for Promotion of Industry and Internal Trade (DPIIT) has proposed to formulate the national retail policy to promote the growth of domestic trade. This policy will streamline the retail trade and promote ease of doing business in the retail trade sector. The objectives of the National Retail Trade Policy are:

  • To promote e-commerce all over the country
  • To leverage retail trade as a tool for socio-economic development of the country
  • To encourage skill development and create more employment opportunities for all sections of society involved in retail trade
  • To identify and address existing infrastructure gaps affecting the retail trade industry
  • To accelerate investment flow to underdeveloped regions across the country

This Retail Trade Policy would address the issue of physical infrastructure in setting up of data centres along with power supply, connectivity etc. will be established by the relevant implementing agencies, while financing agencies would identify these as infrastructure that they would intend to support. This policy aims to encourage foreign investment in the marketplace and e-commerce platform, in which foreign investment has been made. Apart from facilitating foreign investment in e-commerce marketplaces, the FDI also takes into account the interests of traders, sellers, domestic manufacturers, MSMEs, start-ups and seeks to create a sustainable level in the retail industry. The start-ups and small enterprises entering into the digital sector would be given infant-industry status. The benefits to access the data could be provided to such enterprise and start-ups to ease the process and to provide the best practices and platforms.

The Government through schemes like Services Exports from India Scheme (SEIS), Merchant Exports from India Scheme (MEIS) and policies like repatriation of remittances out of exports through online payment gateway service providers (OPGSPs) has aimed to incentivise exports. Therefore, the Government of India should facilitate and promote exports through e-commerce but not only incentivising exports, but also by reducing administrative requirements and costs along with simplified procedures related to compliances. Government National Retail Policy has identified five areas in its proposed national retail policy—ease of doing business, rationalisation of the licence process, digitisation of retail, focus on reforms and an open network for digital commerce—stating that offline retail and e-commerce need to be administered in an integral manner.

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