Commerce and Industry Minister Nirmala Sitharaman on Saturday said no to allowing foreign direct investment in multi-brand retail but indicated that the government would soon come out with guidelines on FDI in e-commerce.
FDI in multi-brand retail no, no, she said when asked to clarify the government's position on FDI in multi-brand retail trading. However, as per the current policy 51 per cent FDI is permitted in the multi-brand retail sector.
The Minister was responding to questions of netizens during a 90-minute Talkathon. Sitharaman also said that she held consultation with different stakeholders including industry and associations on FDI in the e-commerce sector.
Next month, the ministry will meet representatives of the state government's on the issue, she said. "E-commerce is a very technology driven. It has a very big play and lot of dynamism (is there) in the market. However, issues (in the sector) are several layered and they are very complicated because there are issue related to taxation and the e-commerce definition is also getting wider in scope. So I am spending quite sometime on it. Sooner we will come up with something to state our position much clearer," the minister said.
She added that FDI in e-commerce should not become a backdoor entry for multi-brand retail. The statement assumes significance as a tussle is going on between online and offline retailers. At present, 100 per cent foreign direct investment (FDI) is allowed only in business-to-business (B2B) e-commerce and not in the retail segment. Traders body CAIT had called for a probe in the business model and trade practices of e-commerce companies to find out how they are offering huge discounts.
Replying to a question on MSME, she said the government is talking with commercial banks to ensure that affordable credit is given to the sector. "We are working with the banks and talking with the RBI to see if small and medium enterprises cane be a given a different kind of approach when you are dealing with the credit and banking requirements," she added.
On improving India's ranking on ease of doing business, she said the ministry has taken several steps and by June 30 more central and state government services would be integrated with the e-Biz portal, which provides one-stop clearance platform for investment proposals. "We will see a significant change (in the ranking) this year," she added. On national IPR (intellectual property rights) policy, she said it is not getting delayed as it is in the process of inter-ministerial consultation.
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