Foreign direct investment in the e-commerce industry has been a
hot topic for the last few years. Recently, there were some news
reports on whether over-the-top (OTT) content platforms be covered
by the restrictions under the FDI policy (policy). It is rather
surprising how the news reports misinterpreted the relevant
provisions. Unfortunately, the e-commerce-related provisions in the
policy are far from perfect, both in terms of approach and
drafting.
In this article, we have discussed why OTT content platforms are
not covered by the restrictions, and in general, why the services
sector ought not to have been covered under the e-commercerelated
restrictions
Let's revisit the history of the e-commerce-related
provisions under the policy to get a better perspective.
Historically, FDI was restricted in the retail sector for goods,
both single-brand and multi-brand. Therefore, B2C e-commerce was
restricted. Over a period of time, the policy was liberalised
