MNC retailers must source 30 pc from Indian MSEs: Govt

New Delhi: Cornered over the issue of sourcing from micro and small enterprises (MSEs) under the new FDI policy in retail, the government today dispelled doubts saying the 30 percent obligation before the global players is

limited to India.

This is in contrast to the official note issued last week, when the government allowed 100 percent FDI in single-brand retail and 51 percent in multi-brand, which stated that the 30 percent sourcing by global retailers “can be done from anywhere in the world and is not India specific”.

“No, no that was misconstrued (in the Cabinet),” Commerce and Industry Minister Anand Sharma told reporters here, adding 30 percent of the sourcing has been made mandatory from Indian MSEs.

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He said this provision of procuring from Indian small units will not violate the WTO obligations.

“We have taken a decision, we did it for solar mission and telecom sector and we have deliberated upon it, it is important…it will create jobs, give a fillip to manufacturing of micro and small industry,” he said.

Small enterprises had raised concerns over the clause of 30 percent sourcing from MSEs anywhere in the world saying this may help Chinese rather than Indians in view of cheaper labour in the neighbouring country.

“Chinese products are nuisance for us. And after this (the FDI policy) it will become more difficult for us,” President of Federation of Indian Small and Medium Enterprises (FISME) VK Agarwal has said.

PTI