India on Friday assured global retail giants Walmart and Metro that its reforms agenda was well on course and the decision to put on hold Foreign Direct Investment in multi-brand retail is “just a pause,” forced by compulsions of coalition politics.
This assurance was given by Commerce and Industry Minister Anand Sharma when he met Walmart president Doug McMillon and Germany-based Metro Group's board member Frans W.H. Muller on the sidelines of the World Economic Forum meeting here.
This is for the first time that senior management of the United States and German retailers met any Minister after the Indian government suspended the controversial decision to open FDI in multi-brand retail on November 24.
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Mr. Sharma said the decision to open 51 per cent FDI in multi-brand retail “could not be implemented because of the compulsions of coalition politics as also partisan opposition.”
‘Growth story intact'
“It is just a pause. The decision has only been put on a temporary halt...the India growth story is intact and the government is committed to take forward the reforms agenda,” Mr. Sharma said.
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He said while the government had restarted consultations taking on board concerns of agrarian states, only the bonafide objections would be taken into account.
A statement from the Commerce Ministry quoted Mr. McMillon as saying that Walmart was committed to invest in the Indian market as and when FDI in multi-brand retail was allowed.
Walmart also expressed its willingness to abide by the proposed conditionalities to open the sector to FDI.
‘Good for trade'
“If retail FDI happens, it would be good for the entire trade and the Indian government seems to be confident about that,” Mr. Frans Muller said.
Walmart executive vice-president (corporate affairs) Leslie Dach said: “We are hopeful about the government allowing FDI in retail. India is a very big growth market for us. We do understand that things take some time in a democracy. Even in the U.S., similar things do happen.”
Sources said that the Walmart team conveyed to Mr. Sharma that they were committed to make investment in the back-end retail infrastructure.
Mr. Sharma also met senior management functionaries from Volkswagen which informed him that the German automobile major had plans to invest Rs. 2,000 crore in their expansion projects in India.
Unilever Global Chief Operating Officer Harish Manwani also called on Mr. Sharma and discussed the company's plans for the Indian Fast-Moving Consumer Good market.
Besides, the former U.S. Ambassador to India Timothy J. Roemer said the U.S. administration was a true believer in the Indian economic growth story. “And we are hopeful that India would move forward with its reforms agenda.”
In the midst of the government handing over assurances to global CEOs, key Indian corporate honchos emphasised that the country had to speed up the pending reforms.
“The government should work fast on the reforms agenda. The world is looking at us,” Kotak Mahindra Bank's executive vice-chairman and managing director Uday Kotak said.
Confederation of Indian Industry Director-General Chandrajit Banerjee said: “People are looking at India. They are expecting that India should move forward on the reforms agenda fast.”