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The Confederation of All India Traders (CAIT), in a white paper, has alleged that quick commerce platforms are misusing Foreign Direct Investment (FDI) to dominate suppliers, control inventory and fund predatory pricing strategies, pushing out small retailers out of the market. It added that the unfair playing field is making it difficult for 30 million kirana stores to compete in the market.
The traders’ body accused the quick commerce platforms of using “vertical agreements” to control supply, pricing, and distribution, causing significant harm to competition and “using their dominant position to manipulate prices and control inventory, disadvantaging independent sellers.”
FDI inflow
It further stated that these quick commerce platforms have a massive FDI inflow of ₹54,000 crore. Praveen Khandelwal, Secretary General, CAIT said instead of investing in creating infrastructure or long-term assets, quick commerce players are subsidising operational losses, controlling supply chains, and offering predatory discounts through a small group of preferred sellers. “These practices have allowed QC platforms to capture 25-30% of the market once dominated by kirana stores, putting many traditional retailers on the brink of closure,” he added.
Limit competition
The traders body also added that these platforms “limit competition by securing exclusive deals with preferred sellers, which blocks any independent retailers.” Deeply discounted pricing funded by FDI is squeezing kirana stores out of the market, causing adverse effect on competition, it claimed.
“To hide the violation of FDI and anti-competitive practices, QC platforms omit key seller information, preventing consumers from making informed choices. These platforms are bypassing FEMA guidelines by controlling inventory indirectly through preferred sellers, a practice prohibited under India’s FDI policies,” it claimed.
CAIT alleged that these violations, coupled with a lack of transparency, harm small businesses and are distorting the retail ecosystem. It urged regulatory bodies to intervene, ensuring that QC platforms adhere to fair practices and protect the interests of small traders.
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