Another European major to come into multi-brand retail: Anand Sharma

PTI Posted online: Monday, Dec 23, 2013 at 0000 hrs
New Delhi : Enthused by Tesco's plan to enter the Indian supermarket segment, the government expects another "European major" to apply for the multi-brand retail sector.

"In multi-brand retail trading, the first (application) has come. There will be more and I think another European major will come," Commerce and Industry Minister Anand Sharma told PTI here.

He, however, did not share the details of the possible applicant.

Last week, UK-based Tesco Plc became the first global retailer to seek government's approval to set up multi-brand outlets in India with a plan to invest USD 110 million in partnership with Tata's Trent.

It has sought permission to acquire 50 per cent in Trent's wholly-owned subsidiary Trent Hypermarket Ltd, that runs Star Bazaar stores.

Sharma said his ministry would fast-track the process of clearance for Tesco.

"It (Tesco's application in the Foreign Investment Promotion Board) will be an expeditious approval," he said.

Allaying concerns of global investors, Sharma said that India's foreign direct investment (FDI) policy is attractive and investments are secure and protected.

"Investments are protected and fully secured under the law and FDI policy both," the Minister added.

He alleged that opposition BJP, including its prime ministerial candidate Narendra Modi, had sent conflicting signals to foreign investors.

"Conflicting signals, which BJP including Modi has sent recently, are scaring away the investors," Sharma said.

BJP is opposed to the new policy of FDI in retail and had voiced its concern over it in Parliament.

Tesco's application had come after an year of the policy which permitted global retail majors up to 51 per cent stake to run multi-brand stores in India.

The company's application is in contrast to the US retail giant Walmart, which was earlier very keen to enter Indian multi-brand retail market, ending its partnership in October with Sunil Mittal-promoted Bharti Enterprises, for opening stores in the country.

A WalMart India spokesperson had said: "Under the requirements contained in the new FDI policy, Walmart could not invest in multi-brand retail through the existing Bharti Retail business."

India has to be competitive in manufacturing & exports, says Anand Sharma

India will achieve the modest export target USD 325 billion for the current fiscal but to enhance it substantially, the country needs to boost its manufacturing capability, Commerce and Industry Minister Anand Sharma said.

"India has to grow in manufacturing-led exports because we are not a country very much endowed when it comes to some of the natural resources, which need for our economic growth particularly energy.

"Therefore, India has to become competitive in manufacturing and exports," Sharma said in an interview.

The manufacturing sector, which constitutes over 75 per cent of the index, declined by 2 per cent in October as against a growth of 9.9 per cent a year ago.

During the April-October period of 2013-14 fiscal, the sector's output contracted 0.3 per cent compared to a growth of 1.1 per cent in same period last year.

The dip in the growth rate of the sector has also cast its shadow on the country's exports which has slowed down to about 6 per cent in November.

During April-November, exports grew by 6.27 per cent to USD 204 billion while imports aggregated at USD 304 billion. Trade deficit stands at USD 100 billion.

Sharma expressed confidence that India would achieve its exports target of USD 325 billion for the current fiscal.

"I hope that we will meet our target and we are trying for that. It is a modest target of USD 325 billion and as of now we are on track," he said.

He said the government has announced the national manufacturing policy (NMP) to boost the sector's growth and increase its share in the country's GDP to 25 per cent from the present 15-16 per cent in the next decade. It also aims creating 100 million new jobs by 2022.

It envisages facilitation by the government in infrastructure development and improvement of the business environment through rationalisation and simplification of the regulatory framework.

The NMP would be a key enabler for setting of National Manufacturing and Investment Zones (NMIZs), which are industrial townships, benchmarked to the best manufacturing hubs in the world.