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Google to Join India’s Open E-commerce Network ONDC

UTC by Ibukun Ogundare · 3 min read
Google to Join India’s Open E-commerce Network ONDC
Photo: Google Blog

Both Google and ONDC had a couple of meetings regarding the integration.

Tech giant Google LLC (NASDAQ: GOOG) is reportedly in talks with the Indian government to join the nation’s open e-commerce network ONDC. The Department for Promotion of Industry and Internal Trade came up with ONDC to move digital commerce from a platform-centric model to an open network. The network launched last month to put an end to the dominance of Inc (NASDAQ: AMZN) and Walmart Inc (NYSE: WMT) in the Indian e-commerce sector. The launch was in five Indian cities, including Bhopal, Bengaluru, Shillong, Delhi NCR, and Coimbatore. The plan is to spread ONDC access to 100 cities in India by August, integrating 30 million sellers and 10 million online merchants.

Experts are confident that ONDC is a solution to the worrisome unfair competition among e-commerce service providers in India. Before reports on Google’s move came into the limelight, Flipkart, Reliance Retail, and Amazon were also in talks to join the open network.

Speaking on the Google’s payment service, a spokesperson commented:

“We remain committed to focus on the enablement of small and medium businesses to leverage digital for deeper discovery and payments capabilities with Google Pay.”

Google in Talks with Indian Authority to Connect ONDC

A source revealed that the discussion includes different business arms in Google, including search and payments. A separate source noted that both Google and ONDC had had a couple of meetings regarding the integration. According to the source, Google considers the open network as a way of discovering businesses.

One of the sources said Google’s discussions regarding the network come after its payments business’s success due to the Unified Payments Interface (UPI). Currently, the company’s shopping business just displays listings without carrying out order fulfillment such as delivery.

The Chief Executive of ONDC, T. Koshy, told Reuters that Google is only one of the several companies that want to associate with the project.

The Indian government plans to ease the cost of doing business for sellers who want to list their products online. However, the method of seller listing has triggered comments from industry gurus.  One of them is Google’s former Head of Mobile Ads Business in India, Mahesh Narayanan. Narayanan explained that the highest seller or best-rated sellers may probably be displayed at the top. And this means that it will not be a “level-playing field.”

Meanwhile, the Chief Executive of Arbo Works Ltd. sees a huge opportunity with the integration with ONDC.  Caesar Sengupta contributed to the establishment of Google Pay in India. He said:

“One thing ONDC will definitely need is a consumer player to drive adoption with the masses. You may remember that UPI had only 17 million transactions per month before Google Pay launched and the graph thereafter is a hockey stock.”

At premarket trading, Google stock is trading up 0.40% to $2,174.50.

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