Several Flipkart employees to turn dollar millionaires post the Walmart acquisition [Representational Image]Reuters

The central government's decision to restrict the foreign e-commerce players operating in India has drawn irk from leading American industry advocacy groups. The US industry body has argued that the restrictions to these players would negatively affect the foreign direct investment as well as consumers in long-term.

The statement has come after the Modi led government introduced changes to the foreign direct investment policy for the e-commerce segment. The government has directed the e-commerce players to shun the heavy discounts and cash back offered to their customers.

Chiefly, two of the world's biggest e-commerce players Flipkart and US-based Amazon are likely to be hit hardest after the guidelines relating to regulating the e-commerce players comes into effect starting February 2019.

The US industry body has argued that the deadline provided for implementation of the new norms is too short and does not allow sufficient time for the companies to analyze the policy.

Nisha Desai Biswal, president of US India Chambers of Commerce (USAIC), a wing of the US Chambers of Commerce said that "We urge the government to delay implementation and allow time for comment before the policy goes into effect."

She further went on to add that "the new e-commerce restrictions announced by the government of India on December 26 are a cause for concern. While we are still trying to understand the full implications, we fear that these restrictions will have a far-reaching negative impact both on US investments and on Indian consumers."

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Mukesh Aghi, the president of US India Strategic and Partnership Forum (USISPF), said that the policy intervention made by the central government is going to negatively affect the Indian customers only and in long-term FDI inflows are going to be hampered.

He said that "this is not in the best interest of the Indian consumers. Coming out with such a major policy change overnight without any consultative process eats into the predictability" and reliability factor that all US companies are looking into India for any foreign direct investment.

Press Trust of India reported that the Union Commerce and Industries Minister Suresh Prabhu has aimed to bring in $100 billion FDI to India but the latest restriction would badly hamper such goals.