FDI in multi-brand retail: Format for queries finalised

Written by Kirtika Suneja | New Delhi | Updated: May 21 2013, 06:38am hrs
In the wake of foreign retailers seeking clarity on issues about foreign direct investment (FDI) in multi-brand retail, the department of industrial policy and promotion (DIPP) has drawn out a format to streamline the queries by these companies. The format asks for the companys name, its Indian partner and any individual who wants to invest in the countrys multi-brand retail sector.

We have been receiving a large number of requests from various stakeholders, seeking clarifications on the provisions of the FDI policy. It is noted that many of the requests for clarification do not provide specific and adequate details of the proposal. So, we are unable to take any decision, said a DIPP official.

Once the format is in place, the government will process only those requests which provide the required details in that manner.

The move assumes significance with foreign retailers like US retail giant Wal-Mart and French retailer Carrefour writing to the department, seeking clarity on rules related to mandatory sourcing of inputs from the small and medium enterprises and investing in back-end infrastructure. On the other hand, French hyper-market chain Auchan has sought clarity on investing in FDI and non-FDI stores in India, and if it can use the same back-end infrastructure for the two models. The company wants to set up 80 stores in the next five years through franchisee and FDI routes. It already has a footprint in India through its 13 franchise stores in partnership with Max Hypermarket India of the Landmark Group. Tesco had asked if farm produce would be kept outside the ambit of this clause and also feels that unprocessed and dairy products should not be included.