The Confederation of All India Traders (CAIT) on Wednesday objected to the government’s move to allow 100 per cent Foreign Direct Investment (FDI) in single-brand retail, saying the decision would lead to an easy entry for multi-national companies and harm domestic trade. “It’s a serious matter for small businesses. It is a pity that instead of formulating policies for the welfare, upgradation and modernisation of existing retail trade, the government is more interested in paving way for the MNCs to control and dominate the retail trade of India,” National Secretary General of CAIT Praveen Khandelwal said.
At present, FDI up to 49 per cent is allowed under the automatic route and any investments up to 100 per cent requires government nod. While announcing the policy on Wednesday, the government said the measures were intended to “liberalise and simplify the FDI policy so as to provide ease of doing business in the country”.
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The trade body reminded the BJP-led government that the move was a violation of its poll promises and would lead to a large number of youths losing jobs. “100 per cent FDI in single-brand retail through the automatic route will facilitate easy entry of MNCs in the retail trade and also violate the poll promise of the BJP. The brutal move on the part of the government will render a large number of people jobless,” PTI quoted CAIT as saying.
Besides allowing 100 per cent FDI in single-brand retail, the Centre also allowed investment up to 49 per cent under approval mechanism in Air India and FPIs and FIIs to invest in power exchanges through primary market.