Govt proposes relaxation in FDI norms to attract foreign firms in single brand retail

The government Friday proposed to further relax foreign direct investment (FDI) norms in the single brand retail sector with a view to attract more overseas investment.

Finance Minister Nirmala Sitharaman in her Budget Speech said "local sourcing norms will be eased for FDI in single brand retail sector".

The announcement assumes significance as several foreign entities had raised issues related to mandatory local souring norms from India.

Gokul Chaudhri, partner, Deloitte India, said, "Foreign investment flows eased after a lull of several years, both for portfolio investors and strategic investors. Gradual increase in FDI flow will definitely give a much-needed impetus to the economy and boost consumption."
That time, the government had relaxed mandatory local sourcing requirement of 30 per cent by stating that a foreign retailer would be able to get credit from incremental rise in sourcing for its global operations from India towards the mandatory 30 per cent local sourcing requirement for its business in the country