Manohar Agarwal Demands Policy Shield as E-Commerce Disrupts Traditional Retail

June 22, 2026 — Oliver Benson 4 min read

Manohar Agarwal, speaking on behalf of the Swadeshi Vyapar Manch, has issued a direct appeal to the government for policy intervention to protect traditional traders who are losing market share to e-commerce platforms. The group argues that without swift regulatory support, thousands of small businesses could face closure within the next several years.

Traditional Retailers Sound the Alarm

Agarwal outlined the core of the crisis during a press conference in New Delhi. He pointed to the explosive growth of quick-commerce services, which deliver goods to customers within minutes, as a particularly aggressive threat to neighbourhood shops and family-run stores. The Manch has compiled what it describes as compelling evidence of unfair competition from large e-commerce operators, including allegations of predatory pricing and preferential treatment of certain sellers on platforms.

The organisation is calling for a series of policy measures, including caps on discounts offered by online retailers, mandatory fair visibility rules that would require platforms to give equal prominence to all sellers, and specialised training programmes to help traditional businesses develop digital capabilities. Agarwal told reporters that the government must act now, describing the situation as an existential threat to an entire commercial ecosystem that employs millions of people across the country.

The Scale of the Disruption

E-commerce sales have grown substantially over the past five years, with quick-commerce becoming a significant segment of the online retail market. Traditional shops, which once dominated consumer purchases of groceries, household goods, and everyday essentials, have seen footfall decline in urban centres as consumers increasingly opt for the convenience of ordering via smartphone apps.

The Manch argues that this shift carries serious economic consequences beyond individual business failures. Small traditional retailers serve as employment anchors in local communities, particularly for workers without advanced digital skills. Their loss could ripple through neighbourhood economies, reducing foot traffic for surrounding businesses and eliminating vital social infrastructure in areas underserved by larger retail chains.

Investment and Market Implications

For investors, the tension between traditional retail and e-commerce raises questions about the long-term viability of certain business models. E-commerce companies continue to attract significant capital, but mounting regulatory scrutiny in multiple markets could affect growth trajectories and profit margins. Traditional retail stocks have faced pressure as market expectations shift, though some analysts note that physical stores still hold advantages in categories where immediate gratification or personal service matters most.

Businesses that sit between these two worlds, operating both physical stores and online platforms, may find themselves best positioned to weather the transition. Several major retail chains have already accelerated their omnichannel strategies, investing heavily in delivery infrastructure to compete directly with pure-play e-commerce operators.

The Policy Debate

Government officials have acknowledged the concerns raised by traditional trader groups, though no formal policy response has been announced. Policymakers face a delicate balancing act: supporting a constituency of small business owners while avoiding measures that could stifle innovation or disadvantage consumers who have embraced online shopping.

The Swadeshi Vyapar Manch has proposed establishing a dedicated regulator for e-commerce to oversee platform practices and ensure a level playing field. The group also wants expanded access to affordable credit for traditional merchants looking to modernise their operations. Industry observers note that similar debates have unfolded in other markets, where regulators have grappled with how to address the market power of dominant technology platforms.

What Traditional Traders Need

Agarwal stressed that the goal is not to roll back e-commerce but to create conditions under which traditional businesses can compete fairly. He pointed to examples in other countries where targeted support programmes have helped small retailers develop online presence while preserving the personalised service that distinguishes neighbourhood shops from larger chains.

The Manch is pushing for tax incentives that would help traditional businesses invest in digital tools, as well as streamlined regulations for small merchants wishing to list products on e-commerce platforms. Agarwal argued that these measures would not distort competition but rather correct an imbalance that currently favours large platforms with deep pockets and sophisticated logistics networks.

Looking Ahead

Analysts will be watching for any formal response from the government in the coming weeks. The Swadeshi Vyapar Manch has indicated it will escalate its campaign if policy proposals are not taken seriously, potentially mobilising nationwide protests among its membership. How authorities handle this dispute could set an important precedent for how India regulates its rapidly evolving retail landscape.

The outcome will likely influence investment decisions in both traditional retail and e-commerce sectors. A heavy-handed intervention protecting traditional traders could slow e-commerce growth and reduce returns for investors in digital platforms. Conversely, allowing market forces to operate without intervention could accelerate consolidation in retail, with smaller traditional operators bearing the brunt of the adjustment.