India is trying to build a consensus on liberalising foreign direct investment (FDI) in retail and defence, finance minister Pranab Mukherjee today told a gathering of business leaders and policy makers in Washington.
“Discussions are under way to build a consensus on further liberalisation of the FDI policy in retail and defence,” Mukherjee said.
Differences exist within the Indian government on the appropriate policies for foreign direct investments in the two sectors. The commerce ministry has proposed majority FDI in defence and retail, but the defence ministry wants a maximum of 49 per cent FDI in its field. Some other ministries are opposed to the freeing up of retail and have asked foreigners to invest heavily in cold chains and retail logistics.
Washington is keenly awaiting New Delhi’s moves on retail. The Indian government allows 51 per cent FDI in single-brand retail and 100 per cent in wholesale cash-and-carry. However, multi-brand retailers such as Walmart and Tesco are barred.
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