Global retailers such as Walmart and Tesco can set up warehouses and cold storages as well as source products from small and medium enterprises (SMEs) in States which have not permitted FDI in the multi-brand retail sector, a senior official said.

“Foreign players can set up warehouses and also source products from SMEs from those States which are against FDI in multi-brand retail. No State will stop any foreign player to procure goods or do business with SMEs,” a top official in the Department of Industrial Policy and Promotion (DIPP) told PTI.

U.S.-based Walmart and U.K.-based Tesco have sought clarifications from the Department of Industrial Policy and Promotion (DIPP) on whether they could set up warehouses in States which are against the Centre’s retail FDI policy.

The official also said there would also be no restriction on the foreign retailers from sourcing products from SMEs in those States.

The official also said that 50 per cent of the first tranche of the mandatory minimum $100 million FDI would only have to be invested in back-end infrastructure and not in buying land, existing building or rent.

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