In one of the largest M&A deals in India, US-based world's largest retailer Walmart Inc bought a majority stake in Flipkart. With Walmart buying Flipkart for for $16 billion for a valuation of over $20 billion, the deal has is one of the largest ecommerce acquisitions in the world. The Bentonville company has acquired 77% of the Bengaluru-based company. It should be noted that this is the largest buyout for the US company.
With the Flipkart deal, Walmart is now in a direct competition with its rival, Amazon. While the Indian starts-up are happy about the acquisition, the Indian traders are protesting the deal.
India has liberalized the FDI regime for single brand retail, but there are still restrictions in multi brand retail. Traders feel that the deal will be a backdoor entry for Walmat in India.
Below we have listed out five reasons over their worries with Walmart-Flipkart deal.
1. Confederation of All India Traders (CAIT), an umbrella traders body has called for the nationwide protest against Walmart's 77% stakes in Flipkart. The protest was held at prominent commercial markets in Karol Bagh in the national capital today. CAIT called for the similar protests in Mumbai, Ahemadabad, Bhopal, Chennai, Hyderabad and Lucknow among other cities in the country.
2. CAIT's Secretary General Praveen Khandelwal, who took part in the protest in the city, has alleged that the e-commerce market place has been vitiated to a great extent in past years by several leading e-commerce companies by indulging into all kinds of malpractices, including predatory pricing, deep discounting and loss funding.
3. He said CAIT has already filed our objections in Competition Commission of India and if need arises it shall challenge the deal in the court of law.
4. Traders want central government to scrap the deal claiming that traditional neighbourhood shops will lose their business. They also submitted a memorandum to the district collector, seeking an intervention by central government.
5. “This is nothing but a backdoor entry for Walmart into the retail market of India. It is well proven that they indulge in predatory practices to eliminate competition and then raise the prices of their products,” said Pramod Bhagat, state president for CAIT in Gujarat.
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 "Walmart-Flipkart deal: Why Indian traders are against it, 5 points")
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