Though India’s direct selling industry saw about 12 percent growth during the last fiscal year, direct sellers face an uphill slog amid the country’s unfavorable economic conditions and regulatory climate.
Groups such as the FDCI—a joint forum for direct selling companies, distributors, consumers and manufacturers—have petitioned the government to provide a legislative framework distinguishing legitimate companies, which derive their profit from the ongoing sale of products and services, from schemes that profit largely from individuals buying in to the opportunity for rewards.
India’s present law banning money circulation schemes lacks clear definitions of direct selling and what qualifies illegal operations. The country’s ambiguous legislation has prompted government probes, and even arrests, at various direct selling companies.
A report produced by the PHD Chambers of Commerce and Industries and the Indian Direct Selling Association (IDSA) projects that the industry will see continued growth even in the face of market challenges. “Keeping the current trend, we will continue to aim high despite regulatory or economic hurdles and, as per the report, the industry will grow approximately at 20 per cent year-on-year,” IDSA Secretary General Chavi Hemanth told the Business Standard.