Consumer Affair Ministry declares to allow 49% in multi-brand retail

31st August 2010, New Delhi

According to the recent report, the Consumer Affair Ministry has marked green signal for having 49 percent foreign direct investment (FDI) in multi-brand retail chains.

Presently, India only allows 100 percent FDI in cash-&-carry operations and 51 percent in exclusive or single brand retailing. “Multi-brand retail should be permitted with a cap of 49 per cent. A significant chunk of investments should be spent on back-end infrastructure, besides logistics and agro-processing,” the Consumer Affairs Ministry had said in response to the discussion paper floated by the Department of Industrial Policy and Promotion in June on allowing 100 percent FDI in multi-brand retail.

According to a senior government official, the Consumer Affairs Ministry has sought the enactment of the National Shopping Mall Regulation Act to regulate the fiscal and social aspects of the retail sector, besides allowing mom-&-pop stores to become franchisees of multi-brand retailers.