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Magazines Archives - 2011 December FDI in Indias retail market suspended 
THE Indian government has suspended plans to open up Indias US$450-billion retail market, following nationwide protests from both opposition parties and kiranas (mom-andpop stores), which led to a temporary halt to Indias parliamentary winter session that is set to wrap by December 21 this year. On November 28, the local government had approved a new ruling that would allow 100% foreign direct investment (FDI) in single-brand retailing and 51% FDI in multi-brand retailing, a move that was expected to help transform the local economy by improving the countrys infrastructure. Said Indias Finance Minister, Pranab Mukherjee, in a statement to Parliament on December 7: The decision to permit 51% FDI in retail trade is suspended till a consensus is developed through consultations among various stakeholders. Earlier , Anand Sharma, Indias Minister of Commerce, said opening up FDI in multi-brand retailing will bring in much needed investments, technologies and efficiencies to unlock the true potential of the agricultural value chain. The government had also established criteria for investors looking to capitalise on the new ruling, wherein they are required to secure a minimum investment of US$100 million, of which at least 50% is to be set aside for backend infrastructure development. Additionally, foreign investors who set up in the country need to fulfil 30% local sourcing in order to encourage local value addition and manufacturing. The ruling would have been rolled out in only 53 cities in the country with a population of over one million, with smaller cities maintaining the existing policy. ra To view other stories, get a copy of Retail Asia. To subscribe, please download the subscription form from http://www.retailasiaonline.com/subscription.html
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