Govt trying to reach consensus on FDI in multi-brand retail

The government on Friday said consultations are on with states to arrive at a broad-based consensus on allowing 51% foreign direct investment in the politically-sensitive multi-brand retail trade.

Finance Minister Pranab Mukherjee, while presenting the Budget for 2012-13, also said a proposal to allow foreign airlines acquire up to 49% equity in air transport undertakings is under active consideration.

Following widespread opposition, including from its own allies and several states, the government suspended its decision to allow 51% FDI in multi-brand retail.

"Efforts are on to arrive at a broad-based consensus with state governments on allowing FDI in multi-brand retail up to 51%," he said.

In November last year, the Cabinet allowed 51% FDI in multi-brand retail and 100% FDI in single-brand retail.

While the decision on FDI in the multi-brand retail sector has been held back, the government has gone ahead with allowing foreign investment in single-brand retail to 100% from the earlier 51%.

The government is again carrying out consultations with stakeholders like farmer associations, consumer associations and food processing industry to reach on a consensus on the issue.