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Open Network for Digital Commerce: Revolutionising the Revolution

The retail revolution of India has undoubtedly been led by the thriving e-commerce industry of the country. The rising number of internet users has made India one of the fastest growing e-commerce markets in the world. With 560 million internet users, India has become the second-largest country globally in terms of internet users, surpassing the United States. The Indian e-commerce industry has been on an uphill advancement path. Impelled by increasing smartphone infiltration, the introduction of 4G networks and growing consumer wealth, the Indian e-commerce market is anticipated to grow to $ 200 billion by 2026. 

The Department for Promotion of Industry and Internal Trade (DPIIT) has launched its initiative Open Network for Digital Commerce (ONDC), to control digital monopolies and make the industry more inclusive for buyers and sellers alike. Monopolies pose the biggest threat to any rising industry with early movers or global giants curbing competition. ONDC is making e-commerce processes open-source, therefore creating a platform that all online retailers can employ. ONDC comes as a welcome move in a country where e-commerce industry is rising swiftly and the rise is here to stay.

The goal is to render a start-up mindset commissioned by a management with a cutting-edge concept, extensive knowledge of commerce, comfort with state-of-the-art technology, and a positive scope to facilitate development. The purpose of the start-up is to strengthen the network by utilising and developing enabling technology and encouraging wide-scale voluntary cooperation by eco-system players.  

Apart from this, it will also administer foundational services for managing the network like digital infrastructure for the web, standard registry, certification of participants and accrediting agencies, complaint redressal. It will also aid SMEs in their digital transformation by developing ready-made tools to adapt to the network to support existing software applications promptly. The Quality Council of India (QCI) has set up a team of specialists, and several small and medium enterprises have been on-boarded as volunteers to execute the proposed project.  

Kumar Rajagopalan, CEO of the Retailers Association of India, called it a pleasant move that particularly supports numerous small retailers, small manufacturers, and suppliers.   The deviation from the platform-centric pedagogy to an open-source framework will assist the democratisation of digital commerce. ONDC will help digitise the entire value chain, encourage suppliers' inclusion, systematising operations, derive efficiencies in logistics, and enhance value for consumers.  

The government affirms that ONDC will cease the domination of the e-commerce market by a few massive platforms. E-commerce market is currently split into pits managed and controlled by these platforms. With an open network like ONDC that unites buyers and sellers’ crosswise platforms, the government can smoothen the playing field. Through this buyers will also reach sellers across platforms without switching between multiple platforms. 

In an attempt to establish the onboarding process of retailers on e-commerce platforms, ONDC will anchor protocols for recording, vendor identification, and price determination. The DPIIT intends to provide equitable opportunities to all marketplace players to make the best use of the e-commerce ecosystem in the greater interest of the nation and people.

This article has been co-authored by Paridhi Puri, Bhakti Jain and Karishma Sharma.