No rollback of retail FDI; India not afraid of competition: DIPP

Assuaging the fears that the entry of big retailers will flood the market with imported goods and hurt the interest of small kirana stores,he said that imports will happen if consumers want it.

Moreover,checking a surge in imports is part of the export-import policy of the government. Hence it would be misplaced to say this, he said. There are established mechanisms such as anti-dumping duty and safeguards that we can use. Chaudhary further added,If you are asking for 50 per cent investment in back-end,there is a natural in-built incentive for domestic procurement.

Retailers will anyway have to abide by the stringent riders in the policy and will have to source 30 per cent of their material from domestic MSMEs.

Regarding guidelines and notification of FDI in multi-brand,the secretary said that the rules are a work-in-progress and will address the issues raised in the Cabinet. When asked if there will be any further relaxation,he said it would be speculative to comment now.

He,however,ruled out any discussion on the policy rules and at the same time clarified that the notification of the policy will not be put on hold either. But he did not indicate any timeline for notifying the policy.

On predatory pricing,Chaudhary explained that the country has already put in place a functional competition legislation. The Competition Commission is also in place and it will keep a close watch on the issue,he said.

The government last week approved 51 per cent FDI in multi-brand retail and 100 per cent in single-brand retail with stringent riders. The foreign investor will have to make a minimum investment of $100 million and invest at least 50 per cent in back-end infrastructure and source 30 per cent of the produce from SMEs.

The states are free to include their own safeguards to serve the interest of their farmers.

However,the decision has created a political storm and has stalled Parliament. While the BJP has called for rollback of the decision,many state chief ministers including Tamil Nadu have said that they will not allow foreign retailers to open shop in their states.

The secretary,however,said states were consulted when the issue was debated by the Parliamentary Standing Committee on Commerce,and that it is expected from states that they will amend the Agriculture Produce Market Committee Act to enable farmers to benefit from global chains directly procuring from the fields.