E-commerce is getting popular in Asia. Increasing use of e-commerce by consumers and firms in South Asia can potentially help increase competition and firm productivity, and encourage diversification of production and exports, says the World Bank. By unleashing its online trade potential, South Asia can better integrate into international value chains, increase its market access, and strengthen commercial linkages between countries across the region. Although e-commerce has grown significantly in South Asia, online sales account for a mere 1.6 per cent and 0.7 per cent of total retail sales in India and Bangladesh, compared to 15 per cent in China and around 14 per cent globally.
Online transactions can be strengthened by leveraging the reputation of large e-commerce platforms to offer consumer protection, return and redress, and data security as an initial substitute for robust contractual and consumer protection mechanisms, and permitting cross-border e-commerce payments. While cross-border trade within South Asia represents only five per cent of the region’s total trade, e-commerce has the potential to stimulate regional trade by bridging the gap between buyers and sellers on different sides of national borders. Apart from firms, consumers in South Asia stand to gain significantly from the potential reduction in costs and availability of a greater variety of e-traded goods and services.
