Government finally notifies 100 FDI in Single Brand Retail Decision on Multi Brand Retail still suspended

Department of Industrial Policy and Promotion (DIPP) has today notified the decision to allow 100 percent Foreign Direct Investment (FDI) in single brand retail via Press Note No.1 (2012 Series). This move will allow foreign giants to buy out the domestic partners and have full ownership of their India operations. The notification is operative with immediate effect..Department of Industrial Policy and Promotion (DIPP) has today notified the decision to allow 100 per cent Foreign Direct Investment (FDI) in Single brand retail via Press Note No.1 (2012 Series). This move will allow foreign giants to buy out the domestic partners and have full ownership of their India operations. The notification is operative with immediate effect..The Government has permitted 100 percent FDI in Single brand retail under the government approval route subject to certain conditions..Some of the stipulated conditions are:.(a) Products to be sold should be of a ‘Single Brand’ only..(b) Products should be sold under the same brand internationally i.e. products should be sold under the same brand in one or more countries other than India..(c) ‘Single Brand’ product-retail trading would cover only products which are branded during manufacturing..(d) The foreign investor should be the owner of the brand..(e) In respect of proposals involving FDI beyond 51%, mandatory sourcing of at least 30% of the value of products sold would have to be done from Indian ‘small industries/ village and cottage industries, artisans and craftsmen’..The application seeking permission of the Government for FDI in retail trade of ‘Single Brand’ products would be made to the Secretariat for Industrial Assistance (SIA) in the DIPP. The application will need to specifically state the product/ product categories which are proposed to be sold under a ‘Single Brand’..The Union Minister for Commerce Industry and Textiles said, “Cabinet took the conscious decision to liberalise policy for FDI in single brand retail. FDI in single brand has led to emergence of some global majors in Indian market”..Currently, India allows 51 percent FDI in single brand retail. With this notification, the Government has raised the cap to 100 percent..The Cabinet had on November 24, 2011 cleared the long overdue reform, raising the cap on single brand retail to 100 percent from existing 51 percent and allowing 51 percent FDI in multi-brand retail..However, due to protests from opposition parties, the Government had to suspend its decision on multi-brand retail.