Unmindful of the opposition that attempts to open retail sector to foreign players has aroused, the Economic Survey has suggested that the government should allow a share of foreign equity in all retail trade.
“Allow 100 per cent foreign equity in foreign branded, specialized retail chains (e.g. luxury brands, consumer durables, semi-durables),” the survey tabled by finance minister P. Chidambaram stated. The government has already permitted 51 per cent foreign equity in single product retailing.
The Survey points out that the government had undertaken a comprehenRetasive review of the FDI policy and extended automatic routes, raised equity caps and removed restrictions as well as simplified procedures.
Global retail giants Wal-Mart, Tescos and Carrefour and Metro have shown keen interest in tapping the growing Indian retail market. However, even as the entry of foreign retail players was being opposed several domestic giants like Reliance Industries, Aditya Birla group and Kishore Biyani, amongothers have been setting up network at a rapid pace.
Wal-Mart’s tie-up with the Bharti group had evoked strong opposition, and the PMO had called for a detailed study of the possible impact of large-scale retail operations.