Economy

Govt to soon consult CMs on retail FDI

Arun S. New Delhi | Updated on March 12, 2018 Published on March 16, 2012

Traders to hold nationwide protests, rue that nothing done to modernise existing set up

Immediately after the Finance Minister, Mr Pranab Mukherjee, gave an assurance on the Government’s commitment to further open up the multi-brand retail trade to foreign direct investment (FDI), the Commerce, Industry and Textiles Minister, Mr Anand Sharma, said he will soon hold consultations with all the Chief Ministers on the issue.

Claiming that the stakeholder consultations are in the final stage, Mr Sharma said he hopes to achieve a broad-based consensus shortly on greater opening up of the sector in a calibrated manner, so that it is beneficial to farmers and consumers.

Nationwide protests soon

However, the Confederation of All India Traders (CAIT) Secretary-General, Mr Praveen Khandelwal, told Business Line the move to liberalise the sector “amply indicates the hidden effect of multinational companies and corporate houses on Government policies.” He alleged that the Government has not announced any steps in the Budget to upgrade and modernise the existing retail trade in the country.

Over 5,000 trade associations comprising five crore traders in the unorganised sector will shortly hold nation wide agitations against the move to open up retail trade to foreign investment, he said.

He said CAIT will also form alliances with prominent farmers’ organisations, labour unions, consumers, small and medium enterprises, hawkers and the cooperative sector to hold protests.

Retail stocks up

Meanwhile, stocks of retail companies went up on Mr Mukherjee’s statement that efforts are on to arrive at a broadbased consensus on the issue in consultation with the States.

Provogue jumped 10.5 per cent, while Kouton Retail went up 3.5 per cent, Shopper's Stop (3.3 per cent), Trent Ltd (1.8 per cent) and Pantaloon Retail (1.5 per cent).

Mr Mukherjee had also said that, “Organised retail helps in reducing cost of intermediation due to economies of scale, benefiting both consumers and producers.”

Currently, 100 per cent FDI is allowed in single brand and in cash and carry wholesale trade.

However, the decision on permitting 51 per cent FDI in multi-brand retail trade, subject to compliance with specified conditions, has been kept in “abeyance” following protests.

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Published on March 16, 2012
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