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Making clear the government's stand on FDI in multi-brand retail, Commerce and Industry Minister Nirmala Sitharaman on Wednesday said the NDA government will 'not entertain' foreign direct investment (FDI) in the sector.
She said during Question Hour in Rajya Sabha that BJP got a massive mandate on the basis of its election manifesto which opposes FDI in multi-brand retail.
However, the government has not yet initiated any move to scrap the policy of allowing FDI in multi-brand retail that was approved by the previous UPA government.
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"The mandate given to government is on the basis of our manifesto...We do not entertain FDI in multi-brand retail," she said.
Sitharaman added that FDI flows have not been consistent in the past few years.
"During the last three years, FDI inflows have fluctuated. FDI inflows decreased by 26.33% in 2012-13 and increased by 6.12% in 2013-14," she said.
FDI flows are dependent on the business environment and how decisions are made, she said, adding that such maximum inflows came from Mauritius.
Mauritius accounted for $80.809 billion out of $222.89 billion that came to India between 2000 and 2014.
"We are using FIPB to carry out a check (on investing companies)," she said.
Even in sectors where FDI is allowed under automatic route, RBI scrutinises the funds flow, she said.
RBI and Department of Revenue through FIPB takes critical look at the kind of investment coming into India, Sitharaman added.
"Under the liberalised economic environment, investment decisions of investors are based on the macro-economic policy framework, investment climate in the host country, investment policies of the trans-national corporations and other commercial considerations," the minister said.
