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Govt launches campaign to sell FDI in retail

Last Updated: Sunday, November 27, 2011 - 11:44

New Delhi: Under attack from the Opposition
and UPA ally Trinamool Congress on allowing global retail
chains in the Indian market, the government on Sunday launched a
campaign to sell advantages of FDI in multi-brand retail.

In a full page advertisement in newspapers, the Commerce
and Industry Ministry said foreign direct investment (FDI) in
multi-brand retail will help farmers, create more jobs and
benefit consumers.

It said there are several myths on the issue. These
include that kirana and retail stores will lose and retail
sector will be controlled by foreign stores.

On the other hand, the reality is that domestic retailers
will benefit from sourcing their requirements from wholesale
cash and carry store at a discount, it said.

The government said in countries like China, Thailand,
Indonesia, Brazil and Singapore, where there are no caps on
FDI, small retail stores have flourished.

The government advertisement said that there is another
myth that FDI in multi-brand may result in job losses.

"Contrary to this mistaken belief, FDI in multi-brand retail
will generate 10 million new jobs."

It said that it is also a fiction that farmers would be
exploited and lose their fields and crops to foreign
investors. On the other hand, "farmers will receive better
remuneration for their produce".

In a bold decision, the Cabinet on November 24 decided to
allow 51 per cent FDI in multi-brand retail and removed the 51
per cent FDI cap on single brand retail.

Almost the entire Opposition and Trinamool Congress are
up in arms against the decision and have paralysed Parliament
in protest.

Some Chief Ministers of the states, ruled by the central
opposition parties, have also expressed anguish on opening up
of the sector for foreign chains like Walmart and Carrefour.

Uttar Pradesh Chief Minister Mayawati has made it clear
that her state would not grant trade licence to the global
chains.

The final authority of issuing trade licences rests with
the state governments.

Commerce and Industry Minister Anand Sharma has expressed
hope that states would welcome the decision and open their
doors for the foreign chains. He said he was sympathetic to
farmers and consumers in those states where the mega stores
will not be allowed.

PTI



First Published: Sunday, November 27, 2011 - 11:44

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