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CPI(M) moots regulations for organised retail trade

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Licensing and cap on number of large format stores

The CPI(M) General Secretary, Mr Prakash Karat, addressing a press conference in the Capital on Wednesday. Kamal Narang
The CPI(M) General Secretary, Mr Prakash Karat, addressing a press conference in the Capital on Wednesday. Kamal Narang

Our Bureau

New DelhiMay 30The Communist Party of India (Marxist) on Wednesday proposed stringent regulations for the organised segment of the country's retail trade, including licensing requirements for opening large format stores. It also called for the involvement of small retail associations and street vendors in issuing these licences.

The party, a key ally of the UPA Government, has also mooted a cap on the number of stores that organised players can open in an area. "Several Indian corporate houses have entered the retail sector and are expanding their operations aggressively. These developments in the retail sector are having an adverse impact on the livelihood of a large section of people who are engaged in unorganised retail across the country," the CPI (M) General Secretary, Mr Prakash Karat, said here.

`Restrict outlets'

Mr Karat said the regulations should apply to all existing enterprises. "A single large format retailer should not be allowed to capture a large market share and, for this, it is important to restrict the number of retail outlets that a single private entity can open in a city, State as well as a region," he said.

According to the proposal, the licensing criterion should be the floor area of the outlet in a particular city or town, depending on the population of the place. It called for empowerment of urban civic bodies to set up dedicated bodies with adequate representation to street vendors and small retailer associations for granting licences.

"A single large format retailer should not be allowed to capture a large market share and, for this, it is important to restrict the number of retail outlets that a single private entity can open in a city, State as well as a region," he said.

The CPI (M)'s Central Committee had in April decided to bring out a paper on the party's stand on the need for regulation of the organised sector in retail trade. "We have articulated our stand... We are sending this proposal to the Government as well as other political parties, both in the ruling side and in the Opposition, and would like to have it widely discussed and hope to build a broad consensus on the issue," Mr Karat said.

No deadline

He, however, clarified that the CPI (M) had not put any deadline for implementation of the proposals and was open to a wider debate on it.

The CPI (M) has mooted the consolidation of Government marketing agencies in order to create a few big public sector retail chains, which can also invest in developing modern supply chain infrastructure.

"In order to prevent the development of big private monopolies, it is also important for the Government to ensure its presence in the market," Mr Karat said.

(This article was published in the Business Line print edition dated May 31, 2007)
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