Centre talking to WB, Orissa on pushing FDI in retail: Anand Sharma

In an exclusive interview with CNBC TV 18, Commerce Minister Anand Sharma spoke on the need to take policy action, specifically allowing foreign direct investment (FDI) in retail and civil aviation, to revive waning investor sentiment in the India ‘growth story’.

While the FDI in aviation proposal was still awaiting a final decision, negotiations are on with the Food and Consumer Affairs ministry about allowing FDI in retail, said Sharma. States including West Bengal, Punjab and Orissa, which had concerns about FDI in retail were also being consulted, he said. The minister added that the government is “helpless in this issue (FDI in retail)” as it was trapped by partisan politics.

In the case of single-brand retail companies such as Swedish furniture-maker Ikea, which has been willing make a significant investment in India but voiced concerns over the 30 percent local sourcing norm, Sharma noted that the government has addressed these concerns and expressed hope that India would see more foreign investments in single-brand retail.

Sharma also spoke about the retrospective tax proposal in the interview with the channel that telecom majors such as Vodafone were slapped with, Sharma clarified that it was not an investment-related issue but a revenue related one. “We want to reassure investors that India is committed to sustain policy regime that encourages and protects investments,” Sharma said.

Here are some highlights from the interview

• FDI in civil aviation is under active consideration by the government.
• State approvals are awaited on FDI in multi-brand retail.
• Government hopes money to come from foreign institutional investors.
• The government is examining the arbitration notices by telecom companies in the 2G case.
• FDI in pharma for green field projects in expected to come through soon.
• Gold imports as far as possible have been curtailed.