The BJP is still licking its wounds after being trounced in three key recent state polls and a year ago fighting an unexpectedly close contest in Gujarat — Modi’s home state. Among small businesses, which are a traditional support base, the government’s popularity has been eroded by 2016’s surprise note ban and the subsequent roll-out of GST.

The rules now bar Amazon and Flipkart Online Services from owning inventory, and require them to treat all vendors equally, throttling discounts and exclusives — a huge advantage to homegrown firms, including Ambani’s new venture. His Reliance Industries, which owns India’s largest retail chain and third-biggest telecom network, has the potential to evolve into a local version of Amazon or Alibaba, UBS said last month.

“Whether serendipitous or not, India’s tightened regulatory regime for online retailers is a huge win for Reliance with its new retail ambitions,” Greyhound Research CEO Sanchit Vir Gogia said, “This could be a field leveller for them.”

Ambani wants his consumer offerings — covering telecom, fibre-to-home broadband, media and entertainment and retail — to contribute nearly as much to the conglomerate’s overall earnings as its bread-and-butter energy and petrochemicals businesses.

He’s fresh from disrupting the nation’s telecom sector, which he entered in 2016 with services so cheap that rivals have quit, merged or gone bankrupt, including a carrier controlled by his younger brother. On the back of that success, he last year unveiled plans to create a model that combines Reliance’s consumer offerings into a “hybrid, online-to-offline new commerce platform.”

Analysts at UBS predict Reliance can gain market share in new-age retail given its starting point of 280 million telecom subscribers, a broadband offering, extensive content and a web of 10,000 stores nationwide. The company also wants to partner with India’s 12 million mom-and-pop shops to create distribution and delivery centres.

Reliance resembles Alibaba in its ability to offer bundled services in a fast-growing, fragmented market with low online penetration, according to UBS. Representatives for Reliance, Walmart, Amazon and India’s commerce ministry didn’t respond to requests for comment.

Meanwhile, the US retail giants are being curbed in a market where they have committed billion of dollars and, till recently, looked to have already won. Both will have to cut back on cash-back payments and discounts — a sore point for smaller sellers, who accuse the pair of predatory pricing.

Flipkart’s losses may rise 20-25% following the changes, according to Morgan Stanley, which said in a report that it didn’t think Walmart was considering walking away from the investment. Reliance will probably use the opportunity posed by the government’s tighter rules to make a “grand entry” into e-commerce, said Praveen Khandelwal, national secretary general for the Confederation of All India Traders, a lobbying group that had threatened political repercussions if the February 1 rollout was delayed.