Economy Aug 8, 2012
New Delhi: Only four states and UTs have so far indicated their support for allowing FDI in multi-brand retail, a development which will further delay entry of global chains like Walmart and Carrefour in India.
"Till date, written communications, indicating support for foreign direct investment (FDI) in multi-brand retail trade, have been received from the governments of Delhi, Manipur and from Daman & Diu and Dadra Nagar Haveli," Minister of State for Commerce and Industry Jyotiraditya Scindia informed the Rajya Sabha today in a written reply.
The Department of Industrial Policy and Promotion (DIPP) had written to governments of all states and Union Territories on June 19 to elicit their views on the contentious issue. The Union Cabinet had decided on November 24, 2011 to allow 51 percent FDI in multi-brand retail, but the same could not be implemented in the face of strong opposition from UPA-ally Trinamool Congress and several state governments.
Scindia said there was no proposal to allow 100 per cent FDI in multi-brand retail. In the backdrop of the government facing flak from a section of industry and some global investors for policy inaction, the government has renewed its efforts to forge a consensus on opening the retail sector estimated to be over $ 600 billion. "No decision has been taken in the matter," he said.
In reply to a different question, the minister said that the government has not taken any decision on the two proposals for 100 percent FDI in the single brand retail. While Swedish furniture major IKEA proposes to invest Rs 10,500 crore, UK-based footwear major Pavers wants to invest additional Rs 100 crore in the Indian market. Till May, the total FDI equity inflows in the single brand retail trade are meagre Rs 204.07 crore.
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