They have requested the government to create a unified FDI policy for ‘retail trade’ as channels like e-commerce are just a sub-set of retail trade
Struggling with big sales unleashed by e-commerce giants, retailers have knocked at the door of North Block for help.
Leading retailers met finance minister Arun Jaitley and requested him to allow 49% foreign direct investment (FDI) in the sector through the automatic route.
While e-commerce players get 100% FDI for the market place model, there is no law in place for domestic retailers to seek foreign funding. Retailers said they urgently need foreign funding to survive the e-market onslaught.
They have requested the government to create a unified FDI policy for ‘retail trade’ as channels like e-commerce are just a sub-set of retail trade. In the absence of a policy for the retail sector as a whole, there are a lot of violations in the market. Retailers said the ambiguity in the e-commerce policy despite the government’s clarification on the market place has led to some of the online players violate the FDI rules.
The delegation of retailers under the banner of Retailers’ Association of India included top honchos from Future Group, Shoppers Stop, Tata Group, Aditya Birla Group and Landmark.
After the meeting with Jaitley, Kumar Rajgopalan, CEO of Retailers’ Association of India, told DNA Money that the retailers want to ensure that they get access to international funds. “There is a need to create one policy for retail and not split the industry by introducing policy for just one channel like e-commerce. The finance minister's views about GST and the need to keep food and clothing in 0 to 6% are indeed welcome and pro-consumers.”
Kishore Biyani, group CEO, Future Group, told DNA Money, “The finance minister has positively assured us to come up with solutions and resolve our issues. Like e-commerce, we just want level-playing field and we support multiple slabs for GST.”
Jaitley communicated to the retailers about the need for multiple slabs in GST. He assures that transaction at rates as close as possible to current effective rate of tax. He also said for all essential products, like food, textiles and apparels, the GST will range between 0-6%.
Indian retailers, who were a part of the delegation, said they have invested over Rs 40,000 crore in the market, and are generating 400,000 jobs with annual sales exceeding Rs 100,000 crore.
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