Indian Seller Collectives Ask Narayana Murthy to End Ties with Amazon

The Indian Sellers Collective, a non-governmental trade association, has written an open letter to N.R. Narayan Murthy urged him to sever ties with Amazon for Cloudtail India. It is said that the move is about bringing the voice of micro and small enterprises and family businesses across the country.

The letter details Murthy, an idol of millions of Indians, for leading a revolution in the Indian IT industry through his contribution towards establishing an ace company like Infosys. He is considered a fair man for his adherence to straight and narrow and constant emphasis on honesty, integrity, fairness, values, and transparency.

However, the virtues had been challenging since 2014, when he struck a deal with Amazon for its name-lending arrangement with Cloudtail, defying the policies of the Indian Government. The letter details how for a fixed fee or returns, Murthy has compromised the interests and livelihood of millions of small Indian traders and let Amazon take advantage of their pity situation.

Importantly, Cloudtail India is the largest seller on Amazon India, which is found to be non-compatible with the country’s FDI regulations on many terms; however, in reality, it is owned by the mysterious Hober Mallow Trust.

It is further clarified by the fact that much senior leadership of Cloudtail and the majority of board members of Cloudtail are Amazon’s former employees. Factually, the Government of India brought amendments to stop practices of foreign retailers forming front companies to carry out retailing. As a result, Murthy promptly increased his stake to 74 %, but the company's identity remains suspicious.

Speaking on the issue, Ashwani Mahajan, National Co-Convener, Swadeshi Jagaran Manch, said: "Foreign retailers operating ecommerce marketplaces in India have been finding creative routes to defy India's retail FDI laws. It is a cause of worry among the Indian seller community, necessitating a need for continued strengthening of the policies governing Indian e-commerce. Amazon India, through arrangements with companies like N.R. Narayana Murthy's Cloudtail is indulging in predatory pricing and discounting, thereby destroying the business of offline retailers and small sellers."

"Foreign ecommerce retailers operating in India have time and again mocked the spirit of the law while following the letter of the spirit. Amazon's covert understanding with Cloudtail, a majority company of N.R. Narayana Murthy is one such glaring example. " added Abhay Raj Mishra, President, Public Response Against Helplessness and Action for Redressal (PRAHAR).

The spokesperson from AIOVA said: "It is sad to see Murthy associating himself with an economic terrorist called Cloudtail, which crushes thousands of e-commerce sellers inspired by the successes of Murthy."

"He must once again rise to the occasion and come clean on his alliance with Amazon India and the Hober Mallow Trusts and Catamaran," said Dhairyashi H. Patil, President, All India Consumer Products Distributors Federation (AICPD).

"Cash-rich entrepreneurs in the country are over-ambitious. They are using smart tactics to evade the laws. We must stop them in their tracks before they push people into slavery the way East India Company did years ago. It is high time that our lawmakers understand the urgency of the problem, review regulations, and undertake necessary policy reforms to ensure harsh penalties and punishments for lawbreakers," stated Shriram Baxi, General Secretary, Federation of All India Distributors Associations (FAIDA).