Chinese app Shein's strategic India re-entry hinges on data, operational control to Reliance

The Chinese fashion brand Shein’s return to the Indian market depends on stringent conditions set by the government, including complete local control of operations and data under its Indian partner, Reliance Retail Ventures Ltd, Parliament was informed on Tuesday.

In a written reply to the Lok Sabha, Commerce Minister Piyush Goyal confirmed that the government has conveyed its "no objection" to a proposal allowing Reliance Retail to host Shein products on an Indian-built e-commerce platform. The approval follows consultations with multiple ministries, including home affairs and electronics and IT.

Under the agreement, Reliance will maintain full ownership and operational control of the platform. All infrastructure will be hosted in India, and data collected from Indian customers—both personal and non-personal—will remain localised within the country, with Shein having no access to the data.

"As per the agreement, at all the times, the Platform will be hosted on infrastructure in India and all platform data (personal and non-personal data generated from the operation of the Platform including all data collected from Indian customers) will remain in India with Shein having no access to, or rights over, such data," Goyal said.

"RRVL is also advised to ensure compliance with all existing laws of India and security audit of complete infrastructure can be undertaken by any government empaneled cyber security auditor," he said.

Shein was among a host of Chinese apps banned in 2020 over data security concerns in the aftermath of the Galwan clash. Goyal, however, clarified that the sale of Shein-branded products was not banned.

Shein’s partnership with Reliance would mark a strategic re-entry into one of the world’s largest and fastest-growing retail markets, albeit under strict regulatory oversight.

In response to concerns about safeguarding the interests of small retailers and ensuring fair competition in the retail and e-commerce sectors, Goyal highlighted several government initiatives, including Open Network for Digital Commerce (ONDC).

"The initiative of the Open Network for Digital Commerce (ONDC) makes e-commerce more inclusive, enabling small and medium-sized businesses to use any ONDC-compatible applications instead of being constrained by platform-centric policies," he said.