Union Budget 2011: Retailers disappointed with no mention of FDI in retail

NEW DELHI: Large domestic retailers are disappointed with no mention of allowing foreign investments in multi-brand retail in the Budget 2011-12. They, however, feel steps taken to boost agriculture in terms of providing subsidies to framers, recognition of cold storage facilities as infrastructure sector is a step in that direction.

“We were expecting some statements around opening of multi-brand retail to foreign investments,” Kishore Biyani, CEO, Future group said. However, the government’s move to announce initiatives for the agriculture sector will pave way for the same going ahead, he said.

The country’s existing foreign investment policy, aimed at protecting owners of Kirana shops, bars global retailers from setting up retail chains in India. The country allows 100% foreign investment in wholesale business and 51% FDI in single-brand retailing.

Entry of foreign retailers such as Wal-Mart, Carrefour and Tesco will help tame surging food prices and ensure farmers get better prices for their produce as they will be able to remove inefficiencies in the supply chain and procure directly from farmers.