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After support from five states, govt's hopes high

BS Reporter  |  Chennai 

Anand Sharma

Unfazed by the attack for allowing 51 per cent foreign direct investment (FDI) in multi-brand retail and up to 100 per cent in single-brand retail, Union Commerce Minister said five states have welcomed the move and he expected more states to follow suit.

Allaying fears of small retailers, he reiterated they would not only co-exist with the big ones, but grow by 13 per cent in the coming decade.

Speaking to reporters in Chennai on Saturday, he said, "A few states chief ministers communicated their willingness to adopt the new in the first two days after announcement. I expect more states would come up.” Those who have shown their willingness are Punjab, Haryana, Maharashtra, Rajasthan and Orissa.

“I can only be sympathetic towards the farmers of the states which are unwilling to implement the policy,” he said pointing that the policy would benefit the farmers on price of their products, while avoiding extra charges in the distribution chain.

He said small retailers were growing at 15 per cent every year in the past decade after the government permitted organised retail by Indian investors without any limit or restriction. The overall impact of organised retail policy decision on the small retailer in a decade has been 1.7 per cent.

Further, every investor had to work with Indian people and within the ambit of the "strong Indian laws, including labour laws", Sharma said assuring that the corner stores would be protected. No one can sell products at "predatory prices", he said.

The policy has restricted FDIs in retail to cities with more than one million population, which is only 53 of the 8,000 towns and metros. He said the Indian model was distinct and different from other countries.

First Published: Sun, November 27 2011. 00:32 IST