According to reports, India's financial crime agency has privately sought sales data and other documents from smartphone players including Apple and Xiaomi as part of an investigation into Amazon and Walmart-owned Flipkart.

The agency's inquiries arise against the backdrop of India and the United States approaching a trade agreement.

The protectionist ecommerce regulations in India have been included in those discussions, as US officials have consistently urged for the sector's opening.

India's Enforcement Directorate, the agency that investigates economic offenses, has been looking into Amazon and Flipkart for years for supposedly violating regulations by storing and controlling the products they feature online.

Indian regulations prevent foreign ecommerce firms from doing this since the platforms are only allowed to function as a marketplace linking buyers and sellers.

Small traders in India claim that these hidden practices, coupled with significant online discounts, have disturbed operations at mobile phone shops; however, Amazon and Flipkart assert that they adhere to all Indian regulations.

In recent weeks, the directorate has contacted smartphone manufacturers, such as Apple and Xiaomi, to obtain information regarding their online sales.

The Enforcement Directorate was examining transactions between smartphone manufacturers and Amazon as well as Flipkart, and had requested any financial agreements made by the phone companies for online sales.

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Last year, an independent Indian antitrust probe determined that Amazon and Flipkart violated antitrust regulations by favoring specific sellers on their platforms, and they also conspired with Samsung, Xiaomi, and other smartphone manufacturers to exclusively release products online.