The Trump administration is leveraging tariff threats to push India to open its $125 billion e-commerce market fully to American giants like Amazon and Walmart 's Flipkart , according to recent trade discussions.
Under current Indian regulations, US ecommerce companies can only operate as online marketplaces for third-party sellers, while their Indian competitors can produce, own, and sell goods directly through their platforms. This restriction, which Washington labels a "non-tariff barrier," has long frustrated American retail giants seeking greater access to the world's most populous consumer market.
“Significant progress” in trade negotiations between India and the US
As the Financial Times reports, Vice President JD Vance met with Prime Minister Narendra Modi this week, with both acknowledging "significant progress" in trade agreement negotiations. These talks are taking place under pressure of potential 26% tariffs on Indian exports to the US, which President Trump has temporarily paused for 90 days.
Industry executives familiar with the discussions told the FT that Walmart CEO Doug McMillon raised concerns about India's ecommerce barriers during a recent meeting with Trump at Mar-a-Lago. Amazon CEO Jeff Bezos, who contributed to Trump's inauguration in January, also appears to have the administration's ear on this issue.
The push for market access puts American retail giants in direct competition with Asia's richest man, Mukesh Ambani , whose Reliance group dominates India's retail sector with multiple ecommerce platforms.
Indian trade representatives argue that protecting their retail ecosystem is vital for the country's estimated 90 million small traders. Praveen Khandelwal, an MP with Modi's party, emphasized that while foreign investment is welcome, it "must not come at the cost of distorting India's retail ecosystem."
If successful, these negotiations could dramatically reshape India's ecommerce landscape, potentially benefiting American companies that have sought full market access since 2006.
Under current Indian regulations, US ecommerce companies can only operate as online marketplaces for third-party sellers, while their Indian competitors can produce, own, and sell goods directly through their platforms. This restriction, which Washington labels a "non-tariff barrier," has long frustrated American retail giants seeking greater access to the world's most populous consumer market.
“Significant progress” in trade negotiations between India and the US
As the Financial Times reports, Vice President JD Vance met with Prime Minister Narendra Modi this week, with both acknowledging "significant progress" in trade agreement negotiations. These talks are taking place under pressure of potential 26% tariffs on Indian exports to the US, which President Trump has temporarily paused for 90 days.
Industry executives familiar with the discussions told the FT that Walmart CEO Doug McMillon raised concerns about India's ecommerce barriers during a recent meeting with Trump at Mar-a-Lago. Amazon CEO Jeff Bezos, who contributed to Trump's inauguration in January, also appears to have the administration's ear on this issue.
The push for market access puts American retail giants in direct competition with Asia's richest man, Mukesh Ambani , whose Reliance group dominates India's retail sector with multiple ecommerce platforms.
Indian trade representatives argue that protecting their retail ecosystem is vital for the country's estimated 90 million small traders. Praveen Khandelwal, an MP with Modi's party, emphasized that while foreign investment is welcome, it "must not come at the cost of distorting India's retail ecosystem."
If successful, these negotiations could dramatically reshape India's ecommerce landscape, potentially benefiting American companies that have sought full market access since 2006.
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