When the government is considering 100 percent foreign equity in multi-brand retail and is expected to come out with discussion paper soon. Industry chamber Assocham today expressed its opposition to permitting 100 percent foreign FDI in the multi-brand retail at a go. Assocham president Swati Piramal, said that consequences of such an action should be considered and the chamber should first consult the domestic industry before finalizing the entry of overseas mega malls in the country. In a statement Swati Piramal said, “100 per cent foreign equity in multi-brand retail should not be offered to multi-national companies in a single stroke and consultation with the domestic players is needed before any policy announcement is made.”
Currently, the government bans FDI in multi-brand retail. Though there is a cap of 51 percent on FDI in single-brand retail, it is 100 percent in cash-and- carry format. The industry body also supported 100 percent FDI in single-brand retail, provided the organized retail industry share increases from its current 12 percent to 50 percent in the retail industry. One of the retail players said that, “In a few years, the share of organized retail will be significantly higher and the country will be far more attractive and ripe for attracting higher levels of FDI.”
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