India Proposes Mandatory Country of Origin Filters for E-Commerce Platforms

India Proposes Mandatory Country of Origin Filters for E-Commerce Platforms

Why in News?

The Indian government has proposed a new rule for online shopping platforms to include filters that show products by their ‘country of origin’. The proposal was introduced to encourage e-commerce giants to align with national interests while empowering buyers to choose products consciously.

Highlights of the Proposed Rules of the ‘Country of Origin’ Filter

• The Department of Consumer Affairs (DoCA) under the Ministry of Consumer Affairs, Food & Public Distribution has issued the Draft Legal Metrology (Packaged Commodities) (Second) Amendment Rules, 2025. 
• The proposed amendment seeks to insert a new sub-rule under Rule 6 of the existing Legal Metrology (Packaged Commodities) Rules, 2011. 
• Under the draft, e-commerce platforms must include an explicit filter labelled “Country of Origin” for each imported packaged product. The filter must allow consumers to both search (i.e., locate products by origin) and sort (i.e., arrange listings by origin) the items being offered.
• The proposal specifically addresses packaged commodities sold online, particularly those that are imported. The term “e-commerce entity” encompasses online marketplaces and platforms that host product listings.
• It complements existing rules such as the Consumer Protection (E‑commerce) Rules, 2020 that mandate disclosure of product origin and other key details.
• The draft has been opened for public consultation with stakeholder feedback being invited up to 22 November 2025.
• After consultation, the amendment would be notified and enforced according to specified timelines (to be defined).

Objective Behind Government’s Proposal

• Enhancing Transparency: The government aims to make the product origin information more visible and searchable for consumers. The draft amendment feature will allow buyers to quickly see whether an item is made in India or abroad. The transparency factor is expected to build greater trust in digital marketplaces.

• Promoting Self-Reliance: The policy aligns with the broader national initiatives like Atmanirbhar Bharat to reduce dependency on imports and boost domestic manufacturing. By making Indian-made products easier to find and compare online, the rule seeks to give the “Made in India” label greater visibility.

• Raising Consumer Awareness: When consumers can filter by country of origin, they gain better information to make purchasing decisions. This improved awareness helps shift consumer behaviour toward more conscious buying, especially in an era of large online product varieties.

• Strengthening Digital Marketplace: Introducing easily searchable filters for country of origin also aids regulatory oversight. These filters will help authorities monitor compliance more efficiently and verify product information without laborious manual checks. The step aims to bolster trust, accountability and governance of online platforms.

Key Government Initiatives Shaping India’s E-Commerce Ecosystem

• Government e‑Marketplace (GeM) Portal: Launched in August 2016, the GeM portal enables government departments to procure goods and services online in a transparent manner. In the fiscal year 2021-22 the portal logged orders worth over ₹1 lakh crore, with 57 % of the business coming from MSMEs. The initiative supports digital commerce by enabling suppliers to register and bid electronically. 

• Open Network for Digital Commerce (ONDC): Launched formally in April 2022 by the Department for Promotion of Industry and Internal Trade (DPIIT) with incorporation in December 2021, ONDC aims to democratise e-commerce by enabling interoperability across platforms. The network uses open protocols so that buyers and sellers can connect independently of large proprietary platforms.

• Digital India Programme: The Digital India programme supports the expansion of internet access, digital literacy and online services, which in turn benefits e-commerce. It has helped enhance connectivity in Tier 2 and Tier 3 cities and rural areas. The resulting infrastructure boost enables more buyers and sellers to participate in online commerce.

• Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA): This scheme focuses on rural digital literacy and aims to train millions of rural citizens in basic digital skills. It indirectly supports e-commerce by widening the user base and enabling new sellers from non-urban regions. The result is a more inclusive digital commerce ecosystem.

• Foreign Direct Investment (FDI) Policy in E-Commerce: The government has allowed up to 100 % FDI in the e-commerce marketplace model in business-to-business (B2B) segments, and relaxed norms in other areas. It signals a liberalised approach to foreign participation while safeguarding domestic interests. The policy thereby shapes how e-commerce platforms operate, invest and expand in India.

• MSME Trade Enablement through ONDC (MSME-TEAM): Under ONDC, the government launched the MSME-TEAM initiative to assist around 5 lakh MSMEs (including women-owned ones) between 2024-27 to onboard digital commerce. It enables smaller enterprises to integrate into digital marketplaces and compete. 

Economic and Trade Implications 

• Import: The rule may reduce the attractiveness of imported goods, consumers will more easily filter and identify non-domestic products. This visibility could discourage purchases of foreign-made items and shift demand toward home-made alternatives. Over time import volumes for categories sold online may slow. 

• • Export: The greater focus on origin in domestic online marketplaces may boost the perception and competitiveness of Indian-made exports by enhancing domestic manufacturing strength. Indian sellers who export via online channels may gain added credibility and recognition at home, which could translate into stronger global presence.

• Foreign Trade Relation: Countries exporting to India might interpret increased visibility of “Made in India” goods and origin filters as a non-tariff barrier to their products. India’s diplomatic and trade relations may need delicate handling to ensure this measure does not trigger retaliation or dispute under international frameworks or bilateral agreements.

• Domestic Manufacturing: For the domestic manufacturing sector the rule offers a potential competitive advantage. Local manufacturers will enjoy better discoverability on e-commerce platforms due to the origin filter highlighting their products. Over time the improved visibility can help scale-up manufacturing, create jobs, and promote deeper supplier networks.

Challenges 

• Difficulty to Identify CoO: Many products sold online pass through multiple countries during manufacturing, packaging, or assembly. Determining the true country of origin can therefore be complex. Sellers may struggle to trace where the majority of value addition occurs. 
• Compliance Burden on Sellers: E-commerce companies will need to modify their digital infrastructure to include searchable filters for origin. Small and medium-sized sellers may find it expensive and time-consuming to update product listings. It will add operational costs and technical challenges for platforms.
• Enforcement Issues: Ensuring compliance across millions of listings is a major challenge for regulators. India’s online retail ecosystem is vast and constantly changing. Government agencies must develop strong digital monitoring systems and penalties to prevent false claims or incomplete disclosures.
• Possible Trade Concerns: Trading partners might interpret this rule as a protectionist move favouring local goods. It could lead to complaints or trade discussions under the World Trade Organization (WTO) framework.