Centre okays FDI in retail

NEW DELHI: Government is considering opening up of retail and realty sectors for foreign investment and is expected to firm up its policy in next two months.

"We are examining various parameters. We should be able to come with a policy in next two months," Commerce and Industry Minister Kamal Nath told reporters on the sidelines of Indo-American chamber of Commerce Summit on infrastructure.

"We have had discussions with the retail sector. We want incremental FDI to come in the sector. We do not want FDI which would displace the existing investment," he said adding that more discussions were to be held.

Asked if the FDI in retail will form a part of India''s offer on services at WTO, which have to be tabled before May 31, Nath said," Our offers in Mode 2 and 3 would be driven by offers we recieve in Mode 1 and 4."

For supply of services, Mode 1 is for cross border supply (eg-Business Process Outsourcing), Mode 2 is investing overseas (eg-foreign banks), Mode 3 is consumption of service abroad (eg-tourism, education) and Mode 4 is movement of natural persons.

Nath said while the policy may be a part of the offers it was not driven by the offers.

He said FDI in realty should be driven towards construction and not just investment in land holdings and the policy would aim to address this.