New Delhi: The new commerce and industry minister Nirmala Sitharaman on Tuesday indicated that BJP led NDA government may not allow FDI in multi-brand retail (MBR) as it could adversely impact small traders and farmers. “At this stage, the party position is very, very clear. We have explained about FDI in multi-brand retail that it probably is not best opened up now, because medium and small sized traders or small farmers have not been adequately empowered... If you open up the floodgates of FDI in MBR, it may affect them,” said Ms Sitharaman after assuming the charge.
On the issue of overall Foreign Direct Investment (FDI), she said that there will not be a “blanket approach” for every sector, and that each and every sector would be looked in a “very, very calibrated fashion”.
BJP manifesto had said that barring multi-brand retail sector, FDI will be allowed in sectors wherever needed for job and asset creation. Although the previous government had allowed 51 per cent FDI in multi-brand retail, only one investment proposal of UK-based Tesco was cleared by the earlier government.
Wal-Mart and other global players had not applied for entry into the Indian retail sector. United Kingdom based retailer has proposed to pick up 50 per cent stake in Trent Hypermarket Limited, a Tata group enterprise, to engage in the activities of multi-brand retail trading. Ms Sitharaman said that she will work to “improve Indian exports, and ensure that job opportunities emerge because that’s a very important plank on which we have contested the recent elections.”
“The economic situation in this country demands that more jobs be provided for the young, talented, well-educated and even the semi-skilled and unskilled people of India,” she added. The minister emphasised that she “will give best of my time” to improve economic and commercial ties with India’s trading partners. Wal-Mart is now only focusing on the wholesale retail sector and is setting up 50 new cash and carry stores in India in the next four to five years.
Congress led UPA government had allowed Foreign Direct Investment in multi-brand retail in 2012 after it was held up previously due to political pressure. Government had in 2011 opened multi-brand retail to Foreign Direct Investment but was later on forced to hold it back due to political pressure from with the UPA and opposition parties. Retailers Association of India, industry body of Indian retailers said it will wait for more clarity from the government.
