New Delhi: The retail sector is expected to benefit from the government''s decision to allow concessional import benefits for equipment required for building cold storages, supply chains and front-end operations.

The benefit of concessional imports under the export promotion capital goods scheme, the annual supplement of foreign trade policy yesterday (See: ''annul trade policy for 2007''), would now be extended to retailers having a minimum area of 1,000 square metres.

However, the policy review stipulates that retailers who opt to avail of the concessional imports would be required to fulfil export obligations at eight times of the duty saved in eight years.

Under EPCG, import of capital goods for pre-production, production and post-production, including completely knocked down and semi-knocked down units are allowed at 5 per cent customs duty. This is subject to an export obligation of eight times duty saved on import to be fulfilled in eight years.

Industry bodies have been asking the government for support for the retail sector through concessional imports of goods such as material handling equipment, and other equipment required for warehousing and distribution facilities besides the capital goods.

The extension of concessional imports to the sector is expected to benefit big organised retailers such like Reliance, Bharti, Pantaloon, among others, who have planned elaborate back end operations. Similarly, global chains like Wal-Mart and Metro have planned large investments in back-end infrastructure like cold storage, refrigerated vans, warehousing and material handling equipments.