Chennai: Guidelines for the new policy of allowing 51 per cent foreign direct investment (FDI) in multi-brand retail outlets will be out within a week, and it will be for states to decide on allowing such retail chains to operate on their soil, said Commerce Minister Anand Sharma.
"The implementation guidelines for the FDI will come out in a week's time. It is for the states to decide in favour of the policy. I am happy to note many state governments have agreed to embrace the policy," Sharma told reporters here Saturday.
According to him, Punjab, Haryana, Maharashtra, Rajasthan and Odisha have indicated their acceptance of the new policy.
"We hope Andhra Pradesh from south to come in favour of the new policy. We will wait for the formal communication from the state governments," Sharma said.
Not agreeing with the query that the central government is trying to shift the responsibility of creating retail back-end infrastructure (cold storages and others) on the retailers as it was not able to create the same as announced in the successive union budgets, Sharma said: "The government is building cold storages but the requirement in India is huge."
On the fears that small retailers will be wiped out of business, he said: "The licensed retailers can get their merchandise from cash and carry outlets at discounted rates. In Indonesia, 90 per cent of the retail business is with small retailers, and in India 85 per cent is in the unorganised sector."
About the opposition to the new policy and the government's attempt to build a consensus amongst all political parties before revising its FDI policy he said: "We tried to build consensus by talking to everyone."
According to him the new policy will benefit micro and small enterprises (SME) as retailers with FDI will have to source 30 per cent of their merchandise from them.
However, the sourcing is not restricted to Indian companies but can be done from companies located anywhere in the world, provided the investment in plant and machinery in those units are less than $1 million.
Sharma said the new policy is path breaking, similar to the information technology and communication revolution brought by former prime minister Rajiv Gandhi and the economic liberalisation in 1991 by the then finance minister Manmohan Singh.
Asked why he did not refer to then prime minister P.V.Narasimha Rao in whose cabinet Manmohan Singh held the finance portfolio, Sharma said: "That is a twisted question. I said Manmohan Singh was the then finance minister."
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