In a bid to stimulate ease of doing business and promote foreign investments, India needs a comprehensive national retail policy on manufacturing and trade of FMCG and retail sectors, a FICCwI-PwC report has recommended.

The report said that this will reduce the burden on Indian and foreign players in complying with multiple policies across States and ensure prompt decision-making, the report added.

“States such as Andhra Pradesh, Maharashtra, and Karnataka have already put in place their retail policies and Telangana, Rajasthan, Haryana and Madhya Pradesh are planning to do so shortly. However, it is in national interest to frame a central policy for the country,” the report stated. Some of the other recommendations include granting industry status to FMCG and retail sector so that companies are eligible for priority sector lending and implementing GST early to achieve cost efficiency and provide fiscal incentives to the industry, including back-end infrastructure and supply chain.

Consumer spending

According to the report, the packaged consumer good sector will grow at the pace of 18 per cent and cross the $100-billion mark by 2020, while India’s retail market is expected to reach $1 trillion fuelled by significant growth in the brick and mortal retail as well as e-commerce. Indian consumer spending is expected to touch the $3.6 trillion mark by 2020 and India’s share of global consumption is also forecast to expand to more than twice the current levels, the report stated. Anurag Mathur, Partner and Leader – Consumer & Retail, PwC India, said, “India is in a strong position in the world where a growing consumption capacity, demographic shape and lifestyle changes will propel double digit growth for consumer business over the next decade. However, the Indian consumers selective participation in global consumption trends & concerns coupled with local infrastructure challenges will require a unique response from companies to win and leapfrog on the growth cycle.”

Increasing incomes, younger consumers and growing access to the Internet is reshaping consumer trends such as uptick in online buying, consumers’ evolving desire for service and opting for health and wellness-driven choices, the report added.

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