In a bid to boost e-commerce exports and open global markets for small and medium sellers, the government is set to initiate consultations with the industry to frame a policy allowing an inventory-based model for e-commerce exports.
The move comes amid growing calls from industry players to permit the inventory model, and follows the US decision to scrap a provision allowing tax-free imports of small packages worth up to $800, a change seen as a setback for small Indian sellers.
If implemented, the proposal would mark a shift from current FDI norms, which bar foreign e-commerce platforms such as Amazon and Walmart-owned Flipkart from holding inventory. Observers say this may explain the government’s urgency to enhance export growth.
The proposal, which has been under discussion for over a year, coincides with signals that India-US trade talks may resume soon. A meeting convened by the Directorate General of Foreign Trade (DGFT) on September 15 is expected to include representatives from Amazon, Walmart, logistics firms, and various government departments, according to sources familiar with the agenda.
Currently, less than 10% of Indian MSMEs selling online participate in global e-commerce exports, constrained by complex documentation, compliance requirements, and high logistics costs. Studies show that nearly 87% of enterprises onboarded for e-commerce exports between 2020 and 2024 had exited by 2025.
An agenda note shared by the DGFT, reviewed by TOI, said the proposal envisages a third-party export facilitation model, where a dedicated export entity linked to e-commerce platforms would manage compliance, logistics, and customs processes, enabling MSMEs to focus on product development, quality, and branding.
Allowing such a move may require updates to DPIIT’s FDI guidelines, including a review of the current prohibition on inventory-based e-commerce for export-only models, the note added.
