The Enforcement Directorate, India’s financial crime enforcement agency, has requested sales data and documents from major smartphone manufacturers, including Apple and Xiaomi, as part of its ongoing investigation into Amazon and Flipkart, which is owned by Walmart, according to sources familiar with the situation.
This inquiry coincides with ongoing discussions between India and the United States regarding a potential trade deal. One Indian official noted that the restrictive e-commerce regulations in India have been a topic of negotiation, as U.S. authorities have consistently called for the sector to be more accessible.
For several years, the Enforcement Directorate has been scrutinizing Amazon and Flipkart over allegations of violating regulations by controlling and stocking products listed on their platforms. Indian law restricts foreign e-commerce firms from taking such actions, limiting their role to serving as intermediaries between buyers and sellers.
Small retailers in India have expressed concerns that these practices, along with significant online discounts, have negatively impacted their businesses. Both Amazon and Flipkart have consistently asserted that they adhere to Indian legal requirements.
In recent weeks, the Enforcement Directorate reached out to smartphone companies, including Apple and Xiaomi, to obtain data concerning their online sales, as indicated by three industry sources and a senior official from the Indian government who requested anonymity due to the confidential nature of the investigation.
One industry source indicated that the Enforcement Directorate is examining the relationships between smartphone manufacturers and the e-commerce platforms, and has sought any financial agreements made by these companies related to online sales.
Apple reportedly received a communication from the agency in March, as noted by one of the sources.
Requests for comments from Apple, Amazon, and Flipkart went unanswered, while Xiaomi declined to provide a statement. The Enforcement Directorate also did not comment on the matter.
According to consultancy firm Bain, India’s e-retail market is projected to surpass $160 billion (approximately Rs. 13,62,590 crore) by 2028, an increase from $57-$60 billion (around Rs. 4,85,459 crore – Rs. 5,11,010 crore) in 2023.
The government official stated that the approach made to smartphone companies was purely for information gathering, and it is unlikely they will face accusations in the matter, although “the investigation is ongoing.”
Should any misconduct be uncovered, the official indicated that monetary penalties could be imposed on the e-commerce companies.
A separate antitrust investigation conducted last year concluded that Amazon and Flipkart had violated competition laws by favoring certain sellers on their platforms and also collaborating with manufacturers such as Samsung and Xiaomi to exclusively launch products online.
The companies involved have refrained from commenting on these developments, and the antitrust investigation remains active.
Data from Counterpoint Research shows that in 2024, Samsung and Xiaomi together accounted for nearly 33 percent of the Indian smartphone market, while Apple held a 7 percent share. Approximately 40 percent of mobile phone sales in India occur online.
A Reuters investigation in 2021 revealed, based on internal documents from Amazon, that the company had significant control over the inventory of some of its largest sellers. Amazon has denied any allegations of wrongdoing.
© Thomson Reuters 2025
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
