New Delhi: Pitching for allowing FDI in multi-brand retail, industry body CII Tuesday said such a move would benefit all stakeholders -- consumers, farmers & SMEs -- and also generate significant employment opportunities.
"This (opening the sector to FDI) would also lead to substantial investment in back-end infrastructure like cold chains, warehousing, logistics and expansion of contract farming," the chamber said.
The move would also open up significant opportunities for expansion of organised retail and allow substantial investment in back-end infrastructure like cold chains, it said.
As per the industry group, organised retail in the country currently stands at about USD 30 billion or 6-7 percent of total retail. Citing a BCG report, it said the total retail market is projected to touch USD 1,250 billion by 2020.
"In this scenario organised retai would have a significant impact on the economy in general and key stakeholders in particular," CII added.
It is estimated that producers especially the farmer community would stand to gain 10-30 percent higher remuneration, 3-4 million direct jobs and another 4-6 million indirect jobs would be created, it said.
Also, consumers would get a price savings of 5-10 percent and government would get additional revenue of USD 25-30 billion by way of multifarious taxes.
"However, to retail to realise its true potential, an investment of about USD 60 billion over the next decade, including real estate development is required," CII added.
With 100 percent FDI in single-brand retail being allowed and recent indications that the government is working at building a consensus for allowing foreign investments in the multi-brad segment, the "sector is hopeful of receiving the investment required to propel it forward," it added.
The chamber said the unorganised retail sector too would gain with FDI in the multi-brand retail.
The government had to suspend its decision to allow foreign investments in the multi-brand retail segment following opposition.
The retail sector is currently dominated by 'kirana' shops or mom & pop stores.
First Published: Tuesday, July 10, 2012, 23:29