India accuses Walmart's Myntra of breaching foreign investment rules
Myntra, owned by Flipkart, sells fashion brands on its own e-commerce website.
Detailing its findings from an investigation, India's Enforcement Directorate said that Myntra declared it was a wholesaler and received $192 million of foreign investment, but then sold most of its goods to a group entity that retailed those products to consumers.
"Myntra Designs Pvt. Ltd was actually carrying out multi-brand retail trading in the guise of wholesale cash & carry," the agency said.
Myntra said in a statement that it had not received documents related to the case from the authorities but that it remained "fully committed to cooperating with them at any point of time".
The firm is "committed to upholding all applicable laws," Myntra added.
Walmart did not immediately respond to a request for comment.
In a bid to protect domestic retailers and traders, India prohibits foreign companies engaging in wholesale business to make any direct sales to consumers.
E-commerce business is also restricted, with foreign-owned companies like Myntra, Amazon and Flipkart allowed to operate marketplaces to connect buyers and individual sellers online, but not to stock goods or offer them directly to consumers.
The Enforcement Directorate said it had filed a complaint against Myntra before an adjudicating authority, without giving details.
Flipkart and Amazon have also faced allegations of breaching India's foreign investment rules.
A 2021 Reuters investigation based on internal Amazon documents showed the company for years gave preferential treatment to small groups of sellers, and used them to bypass Indian laws. Amazon has denied wrongdoing.
Amazon and Flipkart are leading players in India's e-commerce market, which was estimated to be worth $125 billion in 2024 and is set to top $345 billion by 2030, according to India Brand Equity Foundation.
Founded in 2007, Bengaluru-based Myntra was acquired by Flipkart in 2014. Walmart bought a controlling stake in Flipkart in 2018 for $16 billion.
Myntra reported revenues of nearly $600 million in 2023-24, up 15% on the previous year.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Fashion Network
3 hours ago
- Fashion Network
Indian exporters weigh options to deal with US levy that's ‘worse than Covid'
While escalating tariffs pose an existential threat to small enterprises like Twenty Second Miles, the larger ones are considering coping tactics including relocating production lines to countries with a lower tariff barrier, tapping buyers in other geographies and exploring acquisitions in the US. Gokaldas Exports Ltd., one of India's largest apparel exporters that earns about 70% of its revenue from the US, plans to ramp up production in its factories in Kenya and Ethiopia which face just a 10% US levy. 'Africa is looking like a good source at the moment,' Gokaldas' Managing Director Sivaramakrishnan Ganapathi said in an interview. 'We are seeing a huge amount of inquiries for production from that region from American customers.' The mitigating strategies will be a gut punch for Prime Minister Narendra Modi's flagship 'Make in India' initiative and puncture any prospects to position India as an alternative manufacturing hotspot to China. Economists forecast that Trump tariffs could clip India's gross domestic product by as much as 1%. Trump has peppered his tariff onslaught with jibes about how the South Asian nation's trade barriers were 'obnoxious' and its economy 'dead' — remarks that have drawn counter from India's central bank. But businesses are hoping for more than just retorts. Businesses thought 'there would be more predictability,' according to Rohit Kumar, founding partner at public policy consultancy The Quantum Hub. 'In the short term, this threatens our China+1 strategy that India was positioning itself to benefit from. In the longer term, even this rerouting may not work for longer as policies could change,' Kumar said, referring to companies trying to recast supply chains. Analysts Chetna Kumar and Adam Farrar weighed in: 'The additional 25% oil penalty tariff would take the hit to US–bound exports to 60%, dragging GDP by 0.9%. This drop would be concentrated on the key items impacted by these tariffs such as gems and jewellery, textiles, footwear, carpets and agricultural goods — all labour-intensive industries.' The revised US levy announced as a penalty for India's purchases of Russian oil are set to take effect within 21 days, providing time for hectic parlays between New Delhi and Washington DC. In the meantime, companies are working on hedging strategies. Tata Group's Titan Ltd., which sells jewellery, is considering shifting some manufacturing to the Middle East which has lower duties on shipments into the US, Reuters reported Tuesday. Welspun Living Ltd., which sells home fabrics in the US, told analysts last week that it is looking at the UK, European Union, Middle East, Australia, New Zealand and Japan to reduce reliance on the American market. SNQS International, based in the textile hub of Tiruppur in southern India, gets about 20% of its business from the US but is now looking to double down on European nations, according to its founder V. Elangovan. Larger textile manufacturers are also grabbing smaller, low-value orders to keep their factories running and avoid shutdowns, Thukral of Twenty Second Miles said. This risks crowding out the smaller firms. Indian trade bodies across affected industries, including apparel, gems and jewellery, and shrimps, are ramping up calls of support from the Modi government. The Confederation of Indian Textile Industry wants the government to 'fast track' measures to limit the hardship faced by local apparel exporters while an industry body for shrimp exporters is seeking export incentive programs. The Gems and Jewellery Export Promotion Council wants duty drawbacks, pre-shipment loans and deferring interest on working capital facilities, Chairman Kirit Bhansali said in a statement.
Euronews
3 hours ago
- Euronews
Here's why OpenAI's ChatGPT-5 drop matters
OpenAI is dropping the long-awaited GPT-5, the latest model of its popular artificial intelligence (AI) chatbot ChatGPT, on Thursday. The new model has advanced writing capabilities, invents answers less often when it doesn't have the right information to a query, and responds better to health-related questions by flagging potential medical concerns, according to the company. GPT-5 has 'agentic' capabilities that it will use when developing code, meaning that it will be able to perform some tasks and make decisions without human intervention. The updated model can make websites, apps, and games, and can be integrated with users' Google tools, like Gmail and Google Calendar, OpenAI said. People using a research preview version of ChatGPT will also be able to select between four 'personalities' for the chatbot. AI enthusiasts saw that the drop was coming after a since-deleted description for the upgrade on crowdsource coding platform Github was published in the early hours of Thursday morning. The launch of GPT-5 follows OpenAI's introduction of the open-source gpt‑oss series earlier this week. It's the first model where the company has also released the source code since 2019's GPT-2, so it can be fine-tuned by users to meet their specific needs. Why does this launch matter? The launch is the latest development in the road to agentic AI, where agents can take multi-step actions and use tools to browse the web without human prompts. That could look like an AI agent at a customer service centre having the ability to automatically ask questions, look up information in internal documents, respond with a solution, or refer the customer to a human if necessary, according to one example given by Amazon. Earlier this year, OpenAI CEO Sam Altman predicted that the first AI agents will soon be 'joining the workforce' and will 'materially change the output of companies'. In a June blog post, Altman used the example of an AI agent in a software engineering role, saying the agent will 'eventually be capable of doing most things a software engineer at a top company with a few years of experience could do, for tasks up to a couple of days long'. 'It will not have the biggest new ideas, it will require lots of human supervision and direction, and it will be great at some things and bad at others,' he wrote. Agents could also be considered 'real-but-relatively-junior' virtual coworkers that could be scaled to 'every field of knowledge work,' he continued. The OpenAI launch of agentic agents would not be the first from an AI company. Microsoft and Google have already launched AI agents that can be customised based on what services a company needs to provide or what tasks it wants to automate.
Fashion Network
3 hours ago
- Fashion Network
Indian exporters weigh options to deal with US levy that's ‘worse than Covid'
While escalating tariffs pose an existential threat to small enterprises like Twenty Second Miles, the larger ones are considering coping tactics including relocating production lines to countries with a lower tariff barrier, tapping buyers in other geographies and exploring acquisitions in the US. Gokaldas Exports Ltd., one of India's largest apparel exporters that earns about 70% of its revenue from the US, plans to ramp up production in its factories in Kenya and Ethiopia which face just a 10% US levy. 'Africa is looking like a good source at the moment,' Gokaldas' Managing Director Sivaramakrishnan Ganapathi said in an interview. 'We are seeing a huge amount of inquiries for production from that region from American customers.' The mitigating strategies will be a gut punch for Prime Minister Narendra Modi's flagship 'Make in India' initiative and puncture any prospects to position India as an alternative manufacturing hotspot to China. Economists forecast that Trump tariffs could clip India's gross domestic product by as much as 1%. Trump has peppered his tariff onslaught with jibes about how the South Asian nation's trade barriers were 'obnoxious' and its economy 'dead' — remarks that have drawn counter from India's central bank. But businesses are hoping for more than just retorts. Businesses thought 'there would be more predictability,' according to Rohit Kumar, founding partner at public policy consultancy The Quantum Hub. 'In the short term, this threatens our China+1 strategy that India was positioning itself to benefit from. In the longer term, even this rerouting may not work for longer as policies could change,' Kumar said, referring to companies trying to recast supply chains. Analysts Chetna Kumar and Adam Farrar weighed in: 'The additional 25% oil penalty tariff would take the hit to US–bound exports to 60%, dragging GDP by 0.9%. This drop would be concentrated on the key items impacted by these tariffs such as gems and jewellery, textiles, footwear, carpets and agricultural goods — all labour-intensive industries.' The revised US levy announced as a penalty for India's purchases of Russian oil are set to take effect within 21 days, providing time for hectic parlays between New Delhi and Washington DC. In the meantime, companies are working on hedging strategies. Tata Group's Titan Ltd., which sells jewellery, is considering shifting some manufacturing to the Middle East which has lower duties on shipments into the US, Reuters reported Tuesday. Welspun Living Ltd., which sells home fabrics in the US, told analysts last week that it is looking at the UK, European Union, Middle East, Australia, New Zealand and Japan to reduce reliance on the American market. SNQS International, based in the textile hub of Tiruppur in southern India, gets about 20% of its business from the US but is now looking to double down on European nations, according to its founder V. Elangovan. Larger textile manufacturers are also grabbing smaller, low-value orders to keep their factories running and avoid shutdowns, Thukral of Twenty Second Miles said. This risks crowding out the smaller firms. Indian trade bodies across affected industries, including apparel, gems and jewellery, and shrimps, are ramping up calls of support from the Modi government. The Confederation of Indian Textile Industry wants the government to 'fast track' measures to limit the hardship faced by local apparel exporters while an industry body for shrimp exporters is seeking export incentive programs. The Gems and Jewellery Export Promotion Council wants duty drawbacks, pre-shipment loans and deferring interest on working capital facilities, Chairman Kirit Bhansali said in a statement.
