How China’s E-Commerce Crackdowns Could Reshape Global Trade and Benefit Indian Tech Giants

China’s 2025 regulatory crackdown on e-commerce price wars and unfair competition is reshaping the global digital trade landscape. By enforcing stricter pricing transparency rules and extraterritorial provisions in its revised Anti-Unfair Competition Law (AUCL), Beijing aims to curb predatory practices by dominant platforms like Shein and Temu. These measures, however, may inadvertently create opportunities for Indian tech and e-commerce players, including Reliance, to capture market share in cross-border trade and attract capital flows previously dominated by Chinese firms [1].

The Regulatory Shift in China

The NDRC’s August 2025 draft rules mandate that platforms and merchants disclose pricing mechanisms and fee changes in real time, while the AUCL prohibits coercing sellers to undercut costs and imposes fines of up to $5 million for violations [2]. These reforms are designed to protect small businesses and consumers from algorithmic manipulation and opaque pricing strategies. However, they also raise compliance costs for Chinese platforms, which have historically relied on aggressive price competition to dominate global markets. For instance, the AUCL’s extraterritorial scope now subjects foreign firms operating in China to the same rules, forcing global players to align their cross-border strategies with Beijing’s priorities [3].

Capital Reallocation and Indian Opportunities

India’s e-commerce sector, long constrained by restrictive FDI policies (which prohibit foreign ownership of inventory-based models), has seen limited participation from U.S. firms like Amazon and Walmart. However, Chinese platforms such as Shein and AliExpress have circumvented these barriers through licensing agreements and offshore operations, capturing a growing share of India’s $100 billion e-commerce market [4]. The new Chinese regulations, by curbing predatory pricing and reducing the cost advantages of these platforms, could level the playing field for Indian firms.

Reliance, for example, has been expanding its digital infrastructure through JioMart and Reliance Retail, leveraging India’s 700 million internet users and rising middle-class demand for global products. With Chinese platforms facing higher compliance costs, Indian players could gain traction by offering localized services and leveraging India’s digital public infrastructure, such as UPI and Aadhaar-linked payments [5].

Cross-Border Dynamics and Strategic Alliances

China’s cross-border e-commerce (CBEC) pilot zones, which streamline customs procedures and offer tax incentives, have historically enabled Chinese firms to dominate global supply chains. However, the 2025 regulations may slow this momentum by increasing operational complexity for platforms reliant on low-margin, high-volume sales. This creates a window for Indian companies to partner with CBEC zones or replicate their success through India’s own digital corridors, such as the India-Middle East-Europe Economic Corridor [6].

Moreover, the normalization of India-China relations in 2025—marked by resumed aviation links and eased trade restrictions—has opened new avenues for collaboration. Reliance’s investments in electric vehicles and logistics, for instance, could align with China’s 14th Five-Year Plan to enhance global competitiveness, while avoiding the geopolitical risks associated with U.S.-China tech tensions [7].

Risks and Considerations

While the regulatory environment in China presents opportunities, Indian firms must navigate geopolitical risks, including U.S. export controls and ideological tensions. Additionally, India’s own protectionist policies—such as restrictions on foreign ownership of inventory-based e-commerce—remain a barrier to full-scale expansion. However, the rise of digital finance and social commerce platforms like Douyin and Xiaohongshu suggests that Indian tech firms could adopt hybrid models to bypass these constraints [8].

Conclusion

China’s 2025 e-commerce reforms signal a shift from unregulated growth to a compliance-driven market. While this may reduce the dominance of Chinese platforms in global trade, it also creates openings for Indian players like Reliance to capitalize on capital reallocation and cross-border synergies. By investing in digital infrastructure, leveraging India’s unique regulatory environment, and forming strategic alliances, Indian tech firms can position themselves as key players in the next phase of global e-commerce.

Source:
[1] China's Sweeping 2025 Anti-Unfair Competition Law Reform [https://www.quarles.com/newsroom/publications/chinas-sweeping-2025-anti-unfair-competition-law-reform-far-reaching-impacts-on-brand-protection-data-governance-ecommerce-and-platform-regulation]
[2] China Proposes Draft Rules on Internet Platform Pricing [https://english.aawsat.com/business/5178180-china-proposes-draft-rules-internet-platform-pricing]
[3] China's 2025 Anti-Unfair Competition Law: A New Era for the Digital Market [https://www.ainvest.com/news/china-2025-anti-unfair-competition-law-era-digital-market-dynamics-investment-opportunities-2508/]
[4] India's E-Commerce Foreign Direct Investment Rules [https://itif.org/publications/2025/05/14/india-e-commerce-fdi-rules/]
[5] The Impact of Digital Finance on the Development of Cross-Border E-Commerce [https://www.mdpi.com/0718-1876/20/3/180]
[6] China CBEC (Cross-Border E-Commerce) 2025 Guide [https://gatekaizen.com/china-cbec-cross-border-e-commerce-2025-guide-trends-platforms-strategies/]
[7] Strategic Rebalancing in Asia: How China-India Border Trade and Aviation Resumption Signal an Era for Emerging Markets [https://www.ainvest.com/news/strategic-rebalancing-asia-china-india-border-trade-aviation-resumption-signal-era-emerging-markets-2508/]
[8] The Impact of Chinese E-Commerce on Global Trade [https://cross-border-magazine.com/chinese-e-commerce-impact-2025/]