States lukewarm to FDI in multi brand retail trade
08 Aug 2012
States across the country have so far not shown much interest in the central government's proposal to allow foreign direct investment (FDI) in multi brand retail business, with only the governments of NCT of Delhi, Manipur, and the union territories of Daman & Diu and Dadra and Nagar Haveli indicating support for FDI in multi-brand retail trade.
The department of industrial policy and promotion had, on 19 June 2012, written to all the state governments seeking their views on the contentious issue of allowing multi-brand retail trade, minister of state for commerce and industry Jyotiraditya M Scindia informed the Rajya Sabha in a written reply today.
As per extant policy, FDI, up to 100 per cent, is permitted in single-band retail trading, with prior approval of the government. FDI is not permitted in multi brand retail trade.
The union cabinet had, on 24 November 2011, decided to allow 51 per cent FDI in multi-brand retail, but the same could not be implemented in the face of strong opposition from UPA's own allies, including Trinamool Congress, as also several state governments.
However, there was no major opposition to single-brand retail trade, which was allowed.
While there was no specific proposals to allow 100 per cent FDI in multi-brand retail, Scindia said, the government has renewed its efforts to forge a consensus on opening the retail sector, estimated to be over $600 billion, in the backdrop of the government facing flak from a section of industry and some global investors for ''policy inaction.''
