Industry body CII has asked the governments of Delhi and Rajasthan to reconsider their decisions to scrap the FDI policy for multi-brand retail as such investments would help create millions of jobs and benefit consumers.
In separate letters to the Delhi Chief Minister Arvind Kejriwal and Rajasthan Chief Minister Vasundhara Raje, CII President S Gopalakrishnan said that about 10 million jobs are estimated to be created in the retail sector many of which would be accrued to the respective states.
”...we would like to suggest that your esteemed government reconsider its stance on FDI in multi-brand retail in order to attract more investments into the state across all sectors,” said the letter to Kejriwal.
Both the states, which saw change of government recently, have decided to opt out of the foreign direct investment policy. They have communicated their decisions to the Centre.
The Congress lost to the Bharatiya Janata Party in Rajasthan and to the Aam Aadmi Party in Delhi.
The Commerce and Industry Ministry, however, is in the process of seeking legal opinion on whether the states can opt out of the policy overturning their earlier decisions.
Further, the CII letter to Raje said that the policy will help Rajasthan farmers in getting good prices.
“Rajasthan would also benefit from investments into supply chain infrastructure such as cold storage, warehouses and refrigerated transport,” it added.
Twelve states, mostly Congress—led, had agreed to allow global retailers to open supermarket chains. The other states include Maharashtra, Karnataka and Andhra Pradesh.
The central government permitted 51 per cent FDI in multi—brand retail trading in September 2012 and left its implementation to the states.
So far, only UK—based Tesco’s proposal to invest in the sector has been cleared by the central government.