Virtually leaving no scope for a rollback, a determined United Progressive Alliance government on Thursday issued the final notification for allowing foreign direct investment (FDI) in multi-brand retail even as the Opposition took to the streets to protest against the recently announced reforms.
The way is now clear for global retail giants such Walmart, Carrefour and Tesco, to set up shop with a local partner and sell directly to Indian consumers for the first time. The government has also issued the press note for the new FDI norms in single-brand retail to relax the norm for 30-per cent outsourcing from local small and medium industries. This will pave the way for the entry of Swedish retail giant IKEA, which has lined up aRs.10,500-crore investment plan for India.
However, the government has stated that retail trading in any form by means of e-commerce would not be permitted for companies with FDI engaged in the activity of singlebrand retail trading. The minimum amount to be brought in by a foreign investor would be $100 million in multi-brand retail, and outlets may be set up only in cities with a population of more than 10 lakh. At least, 50 per cent of FDI should be invested in 'back end infrastructure' within three years of the first tranche.
Only 10 states and Union Territories have so far conveyed to the Centre their agreement to open FDI in the multibrand retail. These are Andhra Pradesh, Assam, Delhi, Haryana, Jammu & Kashmir, Maharashtra, Manipur, Rajasthan, Uttarakhand, Daman & Diu and Dadra and Nagar Haveli. The major domestic retailers welcomed the decision. Future Group chief executive officer Kishore Biyani said, "Finally, FDI is here. So that is a very good news. There is no threat to us from foreign retailers." Pranab Barua, business director (apparel and retail business), Aditya Birla Group, said, "We have to still wait and watch what happens at the state level. This will help the sector." The decisions to allow 49 per cent FDI by foreign airlines in domestic carriers, 49 per cent FDI in power exchanges and increase in the foreign equity cap from 49 per cent to 74 per cent in service providers like directto-home in the broadcasting sector have also been notified.
Read more at:http://indiatoday.intoday.in/story/retail-fdi-reforms-at-full-throttle-anand-sharma/1/221559.html
Source:India Today
Posted for IILM GSM
The way is now clear for global retail giants such Walmart, Carrefour and Tesco, to set up shop with a local partner and sell directly to Indian consumers for the first time. The government has also issued the press note for the new FDI norms in single-brand retail to relax the norm for 30-per cent outsourcing from local small and medium industries. This will pave the way for the entry of Swedish retail giant IKEA, which has lined up aRs.10,500-crore investment plan for India.
However, the government has stated that retail trading in any form by means of e-commerce would not be permitted for companies with FDI engaged in the activity of singlebrand retail trading. The minimum amount to be brought in by a foreign investor would be $100 million in multi-brand retail, and outlets may be set up only in cities with a population of more than 10 lakh. At least, 50 per cent of FDI should be invested in 'back end infrastructure' within three years of the first tranche.
Only 10 states and Union Territories have so far conveyed to the Centre their agreement to open FDI in the multibrand retail. These are Andhra Pradesh, Assam, Delhi, Haryana, Jammu & Kashmir, Maharashtra, Manipur, Rajasthan, Uttarakhand, Daman & Diu and Dadra and Nagar Haveli. The major domestic retailers welcomed the decision. Future Group chief executive officer Kishore Biyani said, "Finally, FDI is here. So that is a very good news. There is no threat to us from foreign retailers." Pranab Barua, business director (apparel and retail business), Aditya Birla Group, said, "We have to still wait and watch what happens at the state level. This will help the sector." The decisions to allow 49 per cent FDI by foreign airlines in domestic carriers, 49 per cent FDI in power exchanges and increase in the foreign equity cap from 49 per cent to 74 per cent in service providers like directto-home in the broadcasting sector have also been notified.
Read more at:http://indiatoday.intoday.in/story/retail-fdi-reforms-at-full-throttle-anand-sharma/1/221559.html
Source:India Today
Posted for IILM GSM
