India plans to test inventory model for e-com exports

After a pilot with UK, the inventory-based model may be rolled out for the other FTA partners

- Dhirendra Kumar

India is considering a pilot project to allow foreign-funded e-commerce companies to buy goods from local vendors, stock them, and sell to consumers abroad, in a shift away from the current rules that permit these firms to operate only as a marketplace, connecting buyers and sellers.

The plan is likely to be launched first with the UK—India’s new free trade agreement partner. Under the proposal, foreign-funded e-commerce companies can directly buy goods in India and export them to the UK, bypassing the current marketplace-only restriction, two people aware of the matter said.

The government's move to allow inventory-based business model for e-commerce firms is aimed at boosting foreign direct investment (FDI)—India expects to achieve $100 billion in FDI in FY26—and diversify its exports, they said.

Gujarat has emerged as the preferred state to host the pilot project, which would allow e-commerce firms to own and sell products directly to consumers in the UK, instead of only operating as online marketplaces, said the first person cited earlier.