There has been a sea change in the nature of international trade during the past decade. E-commerce has not only come to stay, but has also grown at an astonishing pace. A very large proportion of this kind of buying and selling is done by businesses. Yet, there are no accepted set of rules that govern this trade, unlike the World Trade Organization rules governing trade in goods and services done through brick and mortar shops and offices. There is a complete absence of regulations that can restrict this type of trade, or govern the tariffs that can be imposed. This has been a cause of worry for the developed economies, especially the United States of America and Germany. The rising concern has been a result of the recent suspicion that free trade may not always be beneficial to all stakeholders and, particularly, may be of some cost to the big boys like the US. Donald Trump’s paranoia of foreigners eating into the vitals of the US economy stems from such a concern. The WTO had been tied down by the inconclusive Doha Round, which has, so far, failed to address many of the concerns that had been raised by developing nations like China and India. Now a group of nations have approached the WTO to start a round of negotiations to frame a set of rules for e-commerce. The US has taken the lead in this matter, claiming to protect the interests of its investors like Walmart and Amazon. China has agreed conditionally, stating that the rules should not be loaded in favour of the rich economies of North America and Europe. India has decided to stay away.

India is under considerable pressure from small traders and businesses whose economic interests are threatened by the rise of the likes of Amazon and Flipkart. Obviously, there are political implications of this perceived threat, especially with parliamentary elections round the corner in India. However, given the way world trade is changing rapidly, it is of vital importance that the rules to be framed must be fair to all stakeholders — be they the giants in the virtual market space, or brick and mortar shops and business that provide income and economic sustenance to millions. India has a wonderful opportunity to take the lead in this regard. Shying away from this challenge will neither yield political rewards nor economic benefits from foreign direct investment.