The Central Government is of the view that the farming community is strongly in favour of opening up the multi-brand retail sector for foreign investments but wants certain safeguards to be put in place before that.
The government has set in motion the process for consultations with various stakeholders. It had already held talks within the government departments and got an endorsement for 51 per cent FDI in multi-brand retail. The UPA II was forced to put on hold the Cabinet decision of November 24 to open FDI in multi-brand retail under intense pressure from the opposition parties and its own allies such as the DMK and Trinamool Congress.
The Department of Industrial Policy and Promotion (DIPP) has been consulting small groups of stakeholders, including consumer organisations, small industries and farmers. “From the feedback we got so far, as far as the basic decision of the policy is concerned, everyone has been supportive of the decision,” DIPP Secretary P. K. Chaudhery said. On Friday, the government held consultations with farmers' organisations from various parts of the country. Mr. Chaudhery said every section wanted its interest to be protected to reap the maximum benefit out of the policy.
He said farmer associations were, by and large, supportive of the government's decision. “They welcomed FDI into retail sector. They made a point in terms of implementation of this policy that there should be some safeguards incorporated,” he said.
The associations said state governments should amend the Agricultural Produce Marketing (Regulation) Act to get the full benefit of FDI in the retail sector. The associations which were present at the meeting include Jagriti Agro Tech, Alliance for Sustainable and Holistic Agriculture Organic Farming Association of India, Bharat Krishak Samaj and Kisan Jagriti Manch.
The decision to allow FDI in multi-brand retail had imposed certain conditions on the foreign retailers. These included a minimum investment of $100 million, of which half should be in the back-end infrastructure such as cold chains, processing and packaging. The retailers would also have to source at least 30 per cent of manufactured and processed products from small-scale units.
“The States would probably get consulted. All these will be put up before the government.
At the end of the day, a political decision has to be taken. Cabinet has asked us to carry on further consultations. So in consonance with the mandate of the Cabinet, we have gone for these consultations,” he said.