Govt considering FDI relaxation in multi-brand retail policy

New Delhi: The government is weighing the option of permitting overseas retailers to open stores for selling 'Made in India' products only as it looks to relax the norms for multi-brand retail for attracting more funds and generating more jobs.

 

Sources said the government is considering permitting foreign supermarket players to open retail stores but only for sale of 'Made in India' products.

 

Although the current foreign direct investment policy permits overseas players to hold 51 per cent stake in an Indian retail company, the BJP in its election manifesto had opposed foreign investment in the retail segment.

 

So far, only one foreign player, Tesco, has received approval for opening stores under the multi-brand retail policy. The previous UPA government had cleared the proposal.

 

The FDI policy also imposes several conditions for foreign players like mandatory sourcing of goods from MSMEs and a certain percentage of investment in the back-end infrastructure.

 

These conditions have acted as constraints for foreign retailers.

However, if they would be allowed to retail 'Made in India' goods in the country, these mandatory rules may not be imposed on them, sources added.

 

Opening the retail sector, the government last year permitted 100 per cent FDI in domestic trading of food products. Processing Minister Harsimrat Kaur Badal has recently indicated that the government is actively considering a proposal to allow FDI in non-food items, along with food products, under the multi-brand retail policy and a decision may be taken ahead of the mega world food event here in November.

 

The move assume significance as the government is also expected to announce relaxations in the FDI policy in more sectors, including single brand retail.

 

The easing of the policy will be on the lines of the announcements made by Finance Minister Arun Jaitley in the Budget for 2017-18.

 

The government last year relaxed FDI norms in over a dozen sectors, including defence, civil aviation, construction and development, private security agencies, real estate and news broadcasting.

 

The government is also considering a proposal to increase FDI limit in print media to 49 per cent from 26 per cent. Besides, a proposal to allow 100 per cent FDI through automatic route in single brand retail is also under consideration with a view to attracting more global players.

 

Foreign investments are considered crucial for India, which needs around USD 1 trillion to overhaul its infrastructure such as ports, airports and highways to

boost growth.

 

Foreign investments will help improve the country's balance of payments situation and strengthen the value of the rupee against global currencies, especially the US dollar. FDI inflows into India firmed up by 22 per cent to USD 35.85 billion during April-December 2016.

Shoot

Trending News

Xiaomi pumps Rs 3,500 crore into India business

BlackBuck's out to raise $150M in new round, valuation likely to jump to $800 M

With $21 Billion, Azim Premji among world’s top philanthropists

Google agreed on a $45M exit package for India-origin exec accused of sex abuse

HSBC pegs Zomato's valuation at $3.6 billion ahead of Swiggy

PayU in talks to acquire online payments firm Wibmo for $60M

Quikr close to acquiring refurbished goods marketplace Zefo in all-stock deal

What life looks like after a layoff from an IT company

General Atlantic & Tencent pump in another Rs 80 Cr in ed-tech unicorn Byju's

US Senator Warren vows to break up Amazon, Facebook, Google

SoftBank extends tech reach with $5B Latin American fund

Coverfox hits the market to raise $50M in new financing round

Cognizant faces US lawsuit alleging discrimination

China's Huawei sues US over federal ban on using its products

Germany's Delivery Hero acquires Zomato's UAE biz, invests in India ops

Ahead of deadline, debate rages on e-commerce policy

Flipkart rejigs reporting of Myntra-Jabong head Amar Nagaram

Grofers raises fresh funds from existing investors, valuation hits $425M

Sachin Bansal invests Rs 250 Cr each in NBFCs Altico & IndoStar: Report

I-bank Wolet files $800k suit over Flipkart’s Upstream buy

Flipkart FY18 revenue up 50%, but losses grow 5x

Pine Labs in talks to acquire Amazon-backed Qwikcilver for $100M

India can become 2nd largest 5G market in 10 years: Huawei

Alibaba rival Pinduoduo seeks to raise $1.5B

Twitter Q4 revenue grows to $909M as video ad sales surge

Mukesh Ambani to invest $1.4B in West Bengal, will help e-commerce expansion

Etail may lose Rs 40,000 crore, retail to get a 3rd of it

Steadview Capital invests $74M in Ola valuing it at around $6B

Byju’s ups revenue to Rs 490 cr in FY 18, losses drop by half

Agritech startups Sabziwala and LivLush merge their business under new entity Kamatan

Avail Finance lands $17.2M from Matrix Partners & Ola, Freecharge and Flipkart founders

RBI suggests tax sops, self-regulation to build fintech space

Swiggy hires new CEO for its Access Service, gets new CFO

Logistics company Delhivery registers 44% increase in FY17 revenues

WeWork to acquire one of the oldest social networks, Meetup

Qualcomm rejects Broadcom's $103 billion offer

EasyRewardz gets $2 million Series-A funding

'Anemic' iPhone 8 demand drags Apple shares lower

Lending platform Lenden Club gets Rs 3.5cr in Equity Investment

On festive sales, Flipkart says 65% clients from Tier-II cities