Small retailers face impending extinction due to the dominance of large online retailers like Amazon, SnapDeal, Jio, and Flipkart. Many of them had to deal with declining sales or had to shut down because they lacked the resources to increase their online presence, particularly during Covid-19.
In light of this, the government's ground-breaking Open Network for Digital Commerce (ONDC) initiative, which aims to democratise digital commerce by moving away from a platform-centric approach to building an open network, has the potential to significantly alter e-commerce in India. It would encourage all service and product providers to join the network, regardless of the platforms they use for transactions, forcing retailers to stop operating in silos and acting as a conduit for innovation and e-commerce growth.
This network's implementation would resemble UPI's, which has been a huge success. The main goal of the new initiative is to increase transparency and facilitate information discovery that is produced using open network protocols. It would level the playing field for all parties involved and develop a welcoming digital commerce ecosystem.
After China, Japan, and South Korea, India ranks fourth in the Asia-Pacific region for retail e-commerce sales, according to an e-marketer report from December 2021. According to a Forrester report, India's online retail market will expand at a CAGR of 19.8% and hit $85.5 billion by 2025. Online sales in India made up 3.6 percent of all retail sales in 2020.