Decision on FDI in retail after consultations: Sharma

Decision on FDI in retail after consultations: Sharma

"Policy formulation is a dynamic process. That is why it is always deliberated upon. With the objective of holding consultations with various stakeholders, we had put out a discussion paper because of demands from various stakeholders, foreign investors," Commerce and Industry Minister Anand Sharma told reporters while traveling with Prime Minister Manmohan Singh to Hanoi.

Talking about demands for allowing 51 per cent FDI in multi-brand retail, he said an absorbing national debate has been generated and views, critical or otherwise, received from consumer organisations, farmers associations, industry etc.

"We are aware of demands...I believe in a policy, which is transparent, inclusive and democratic so that when a policy is put in place, there is broad-based consensus," the minister said.

Global retail majors, including Walmart and Carrefour have submitted their views to the discussion paper of the Department of Industrial Policy and Promotion (DIPP). He said while India has allowed FDI of 51 per cent in single brand retail, some major investors want it in multi- brand retail also.

"The government will be considering that for which consultative process is needed," Sharma said. Indicating his favourable approach, he said India needs to have entire value chain from beginning to cash-and-carry in some sectors.

Citing the example of agriculture, he said India is the largest producer of foodgrains and second largest producer of vegetables, but post harvest losses of these products are as high as 35 per cent. "So we are focusing on bringing investments and building infrastructure."

He said investments would be required for the 'value chain' from sorting point, where rural people are involved to the processing stage, adding this will create millions of jobs and will be done while keeping in mind interests of the farming community.

In this regard, Sharma noted that the Prime Minister has said that government's approach would be "progressive and calibrated." He said that India has already put in place investment friendly policies.

Elaborating on these, he said earlier maximum limit FDI approvals for project cost without Cabinet nod was Rs 600 crore. The limit for has been doubled and the term 'project' cost has been removed which means that FDI of five to six times more will be able can be cleared without Cabinet nod.

Also a single FDI policy document has been unveiled which subsumes 178 circulars, Press Notes, all RBI clearances and all Foreign Exchange Management Act regulations.

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