The government should further ease Foreign Direct Investment (FDI) norms, especially in sectors such as multi-brand retail, education and e-commerce — where its stance has been ambivalent till now, the country’s leading industry associations demanded. They also sought more liberalised norms for the insurance industry.
In a pre-Budget meeting with the commerce and industry ministry on Thursday, India Inc. also raised concerns on the “adverse” impact of Free Trade Agreements (FTA) on local manufacturing and demanded support to boost manufacturing, exports and startups. FTAs, they said, have led to import surges as a consequence of lower/nil duties.
“We heard the industry’s perspectives on what the Centre and the State governments can do to boost investment, manufacturing, exports and startups,” Commerce and Industry Minister Nirmal Sitharaman told reporters after the meeting. “They raised concerns on FTAs. We will look into the surge in imports and take measures to raise the competitiveness of the local industry,” she said.
On greater liberalisation of FDI in retail, FICCI said: “Taking into account the sensitivities regarding ‘protecting kiranas’, the government could consider allowing 100 per cent FDI in multi-brand retail in non-food segment such as electronics and apparel. In food space, there is scope to allow 100 per cent FDI in fresh food product retail.”
Though the BJP-led NDA government has not scrapped the previous UPA government-approved policy on FDI in retail, which allowed 51 per cent FDI in multi-brand and 100 per cent in single brand, it has so far discouraged any investment in multi-brand retail to protect the interests of traders, who represent a major vote bank for the BJP.
Read full article: The Hindu