Online fake goods sale: Scrutiny amplified ahead of festive rush

New Delhi: The government is intensifying a crackdown on fake, smuggled and substandard goods sold online ahead of the festive season, ramping up scrutiny of ecommerce sellers, imports and supply chains, officials aware of the development said.

The Central Board of Indirect Taxes and Customs (CBIC) is working with major e-commerce platforms and other agencies to identify suspicious sellers and products, particularly imported goods offered at unusually low prices, merchandise suspected to have entered the country through smuggling channels, and products being sold without mandatory certification, they said.

"This is in collaboration with large ecommerce platforms who approach the government to help them in identifying fake or substandard products, including electronic items, watches, perfume and cosmetics, or products being sold without proper declaration of country of origin," a senior official told ET.

The push comes as online purchases typically surge during the festive period, creating a much larger flow of consumer goods through digital marketplaces. The focus is on the expanding network of dark stores, which are growing in size and are difficult to monitor due to hyper-local presence. They are also under scanner from gross under-reporting of turnover and revenue.

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India's ecommerce sector is projected to grow nearly three times to $345 billion by 2030 from $125 billion in 2024, according to a report by research consultancy Infisum. The country's dark store network is set to nearly triple to approximately 7,500 by 2030 from 2,525 in 2025, driven by surging demand for rapid deliveries, the report said.

The crackdown on fake and smuggled goods on ecommerce platforms comes against a much larger illicit-trade market. A Ficci-Cascade study estimated illicit trade across five key sectors, , including textiles, apparel and FMCG, in the country at ₹7.97 lakh crore a year.

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The government had undertaken a similar broad monitoring exercise around the rollout of GST 2.0, when authorities worked with ecommerce companies and other stakeholders to track consumer complaints, pricing issues and potentially non-compliant transactions. This time, the focus is on physical products moving through the ecommerce ecosystem, starting with their entry into India and ending with their sale to consumers.