A look at India's Open Network for Digital Commerce (ONDC), which could help the country's mom-and-pop retailers compete against rapid grocery delivery startups
Varsha Bansal / TIME :
Context & Ripple Effects
ONDC is the Indian government's attempt to rewire e-commerce as shared infrastructure rather than walled platforms. The groundwork was laid years earlier, when tech companies began partnering with millions of kirana stores for last-mile delivery and digital payments — proof the corner-store network could be activated, if not yet coordinated. By mid-2022, the stakes were clear: sources reported Amazon, Flipkart, and Reliance Retail were in talks to join the very network designed to dilute their dominance.
This TIME piece lands at the start of that arc, before the later chapters: ONDC's nonprofit operator holding trials in over 85 cities after raising $22M, Amazon integrating its logistics and SaaS tools into the network, and — the sobering coda — ONDC struggling to dent the Zomato-Swiggy food-delivery duopoly once discounts were cut back.
First-order effects
- Mom-and-pop retailers gain a route onto digital commerce without building their own apps or fulfillment — they plug into a shared network instead of signing up with a single marketplace.
- Rapid grocery delivery startups face competition from stores already embedded in every neighborhood, attacking their core advantage of dense local presence.
Second-order effects
- Rather than fighting the network, Amazon chose to feed it — integrating its logistics network and SaaS tools after Paytm and others committed, turning ONDC into a distribution surface incumbents can monetize.
- Buyer-side apps become the new battleground: whoever controls the consumer entry point (Paytm, marketplaces) captures demand while sellers compete on price and service inside the network.
Third-order effects
- The 2025 record is cautionary: even a government-backed open protocol failed to break the Zomato-Swiggy near-duopoly once subsidies stopped, suggesting consumer habit and discount economics outweigh interoperability — open networks lower barriers to entry but don't guarantee contestable markets.
- If the pattern holds, state-built open networks will keep being judged less on seller participation than on whether they can shift entrenched two-sided platform dynamics — a test other countries watching India's model will weigh before copying it.
The trend: Government-backed open commerce networks are emerging as a policy tool to counter platform concentration, but India's experience shows interoperability alone has yet to overturn duopoly economics.