100% FDI in E-Commerce

Q.  Which of the following is/are true regarding FDI in e-commerce?

1) Centre has allowed 100% FDI in all forms of e-commerce through government route.
2) The only exception to the above decision of FDI is the market place model of e-commerce where FDI is not yet allowed.
- Published on 31 Mar 16

a. Only 1
b. Only 2
c. Both 1 and 2
d. Neither 1 nor 2

ANSWER: Neither 1 nor 2
 
  • The government allowed 100 per cent foreign direct investment (FDI) through the automatic route in the marketplace model of e-commerce retailing.
  • As per the guidelines issued by the Department of Industrial Policy and Promotion (DIPP) on FDI in e-commerce, foreign direct investment has not been permitted in inventory-based model.
  • At present, 100 per cent FDI is permitted in B2B (business-to-business) transactions under the automatic route.

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