The Confederation of All India Traders (CAIT) has submitted its representation to the Union Government opposing the current policy of foreign direct investment (FDI) in retail trade as well as in e-commerce. The CAIT said it was opposed to 51 per cent FDI in multi-brand retail as also the “circumventing of laws” by e-portals.
The Delhi High Court had last week directed the Centre, on a writ petition moved by the CAIT, to hear the plea of the traders’ body on FDI in retail sector and asked the CAIT to file its representation to the Union Government within seven days.
In its representation submitted to the Ministry of Commerce, the CAIT has said that FDI in retail would be creating an uneven level playing filed, under which the brick and mortar shops would be at a disadvantage in comparison with the big retailers enjoying FDI.
Besides, it would result in mass unemployment.
Violation of law
The FDI policy in retail trade was in violation of law of equality and law of prohibition of discrimination as ensured by the Constitution, said the representation, while drawing the government’s attention to a recommendation of the Parliamentary Standing Committee on Commerce in 2010 not to allow FDI in retail.
The CAIT also demanded scrapping of 100 per cent FDI in e-commerce, while pointing out that the e-commerce players were, in fact, stretching the concept of business to business (B2B) to business to consumer (B2C), which was in contravention of law.
Besides, the introduction of FDI in B2C e-retail would grant backdoor entry to foreign investors in multi-brand retail, said the CAIT, while demanding that the government formulate a specified policy for e-commerce business in the country.
Policy statement
The CAIT called for a categorical policy statement by the government disallowing big investment in retail trade even by way of joint ventures with the Indian partners and suggested formulation of a national trade policy for retail trade and establishment of a separate Ministry of Internal Trade to monitor domestic trade.
