House panel favours regulator for FDI in retail

House panel favours regulator for FDI in retail

Expressing concern that unregulated entry of foreign players into the retail sector could create joblessness, a Parliamentary panel on Tuesday asked the Centre to set up a “Retail Regulatory Authority” to deal with issues concerning FDI in the multi-brand segment.

The panel recommended a regulatory authority to look into the problem, including the impact of FDI in multi-brand retail on medium, small and micro enterprises (MSMEs), farmers, small traders and consumers,” Tiruchi Siva, DMK leader and chairman of the Parliamentary standing committee on industry, told reporters here.

If multi-brand retail chains are not regulated, it will impact MSMEs, farmers and domestic traditional whole sale markets or mandis.

“Once these mandis are eliminated, the big foreign retail giants will manipulate prices and our farmers will be forced to sell their products at low prices dictated by them,” the panel said in the report.

“Our own squeezed out retailers and all those associated with the market and retail trade would lose their livelihood and become jobless. It will add to our already existing social and economic woes, which generate so much unrest and violence,” the committee said.  Taking serious note of the implementation of sourcing norms, the committee suggested that 30 per cent procurement requirement should be applicable item-wise.

While allowing 51 per cent FDI in multi-brand retail, the government made it mandatory for at least 30 per cent of the value of manufactured or processed products to be sourced from small industries.

The committee was also of the view that an institutional monitoring mechanism is essential to remove any unwarranted consequences of the policy on FDI in retail.

Reacting to the suggestion, Commerce and Industry Minister Anand Sharma told reporters here that these are executive functions, and are not functions to be dealt by the standing committees.

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