The Associated Chambers of Commerce and Industry (Assocham) on Friday urged the government to provide industry status to the organised retail sector, which is expected to grow to 20-22 per cent of the total retail market by 2010.
In a note submitted to the ministries of commerce and industry and consumer affairs, Assocham President Sajjan Jindal has said providing industry status is the first basic step needed for reforming the Indian retailing sector.
As per Assocham estimates, the retail sector in the country will grow to $427 billion by 2010, while the organised retail will account for 20-22 per cent of this market.
The share of organised retail is expected to rise significantly because investments worth over $30 billion are being planned by domestic as well as foreign players in the retail space for the coming five to seven years, the chamber said in its report.
The industry status will not only give boost to this sector but also make availability of organised financing and establishment of insurance norms easier.
Granting Industry status may also enable this "high potential sector" to receive fiscal incentives.
Assocham feels the growth rate would be higher with simple legislations.
Retail operations currently need to obtain multiple licenses and permits, ranging from basic trading licences to product-specific licences to pollution clearances.
"These are irritants, add time and cost to the process of establishing a retail chain," Assocham said.
It also called for a proper timeframe within which these approvals should be granted. After the lapse of the stipulated time limit, the approvals should be deemed to have been granted unless there are some queries on the part of the department, the report said.