Monday, August 26, 2002 |
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Feature |
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India in the midst of
e-commerce revolution
Gunmala Suri
IN
the series of latest developments that marked the progress of technology
is the World Wide Web (WWW). On par with the earlier discoveries such as
fire, steam engine and the proliferation of telephone lines, the WWW
ushers many revolutionary changes relating to how human beings
communicate, educate, entertain and the way how they carry on
businesses. This marks a new era in the history of human race.
Traditionally, shopping
or buying has been a personalised behaviour was made on the floor of a
store. The advancements in the information technology are redefining the
business frontiers.
What is e-commerce? Commercial transaction over an electronic medium is
known as e-commerce. It is nothing but business done through the
Internet facility. It is defined as every type of business transaction
in which the participants (i.e. suppliers and end-users) prepare or
transact business or conduct their trade in goods and services
electronically. It includes the use of technology (electronic) to
support or conduct any business practices (commerce).
In simple words
e-commerce is a process of two or more parties making business
transaction via computer and some type of network. The scope of
e-commerce is very wide covering all forms of electronic processes.
The process of
purchasing a product electronically is conceptually similar to the
process of purchasing a product from the physical store. In
business-to-business transactions the purchaser shifts the purchasing
from a physical store to a virtual store on the Internet. The purchaser
browses an online catalogue, selects the product and tells the merchant
system that product is acceptable and he is ready to purchase it. Then
the merchant system tells the purchaser to select the payment
instrument. He may opt for any kind of e-money including credit card.
The underlying technologies involved in e-commerce are Internet and EDI
(electronic data interchange). The Internet needs no explanation.
However, EDI may be defined as application to application transfer of
documents through computers in a standard format. These formats look
like standard forms and highly structured. It is a safe and fast method
and can be applied at various layers of business processes such as
ordering, acceptance, custom clearance, manufacturing delivery etc. EDI
is effective in reducing the cost and implementing efficiency. It is
estimated that 95 per cent of 1000 fortune companies are using it.
Some hurdles that one
faces during e-commerce transactions are:
(a) The existing legal
framework in several countries is not properly placed to encounter the
challenges of the digital age. They need to adopt a global approach to
ensure uniformity in statutory and administrative instruments.
(b) There is need to
bring out cyber laws that recognise the validity of electronic
transactions.
(c) To take full
advantage of global e-commerce, there is need for full-convertibility of
rupee. In India, at present, rupee is fully convertible on current
account only but not on capital account.
(d) There are more problems in case of dealings relating to knowledge
business.
Security of the transactions depends upon the certification by a trusted
third party, preferably a government body. Global e-commerce requires
the establishment of Global Certification System.
Since transactions through so many computers between buyer and seller,
no transaction is secure. Credit card numbers and other sensitive
information could be easily stolen. The tampering of information could
be prevented through a process of encryption.
India is currently in
the midst of an e-commerce revolution. A survey conducted by Indian
market research bureau (IMRB) revealed that only 20 per cent of 318
Indian corporations were currently implementing e-commerce in their
operations. The
total volume of e-commerce transactions in India was worth Rs. 450 crore
in 1999-2000.
Nasscom survey reveals
that e-business transaction in India is expected to go up to Rs. 40,000
crore in 2003-2004. E-commerce phenomenon is globally acceptable and
India is no exception. It alters traditional concepts of time and space.
More and more businesses are turning to the Net to expand their reach,
uncover new markets, to reduce labour and cost. An Indian company with
minimum investment can tap the entire world market.
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