New Delhi, Aug 13 (PTI): The National Democratic Alliance government will not entertain foreign direct investment in multi-brand retailing, commerce & industry minister Nirmala Sitharaman said Wednesday.
She said during Question Hour in Rajya Sabha that the Bharatiya Janata Party got a massive mandate on the basis of its election manifesto, in which it opposed FDI in multi-brand retail.
However, the government has not initiated any move to scrap the policy of allowing FDI in multi-brand retail approved by the previous government.
”The mandate given to government is on the basis of our manifesto...we do not entertain FDI in multi-brand retail,” she said.
She said FDI flows have not been consistent in past few years. “During the last three years FDI inflow has fluctuated. FDI inflow decreased by 26.33 per cent in 2012-13 and increased by 6.12 per cent in 2013-14,” she said.
FDI flow is dependent on the business environment and how decisions are made, she said, adding FDI inflow has been skewed in favour of Mauritius.
Mauritius accounted for $80.809 billion out of $222.89 billion that came to India between 2000 and 2014.
”We are using FIPB to carry out check (on investing companies),” she said, referring to the Foreign Investment Promotion Board, the government body that offers single-window clearance for FDI proposals not in the automatic category.
Even in sectors where FDI is allowed under automatic route, the Reserve Bank of India scrutinises the funds flow, she said.
The RBI and Department of Revenue through FIPB takes critical look at the kind of investment coming into India, she said.
”Under the liberalised economic environment, investment decisions of investors are based on the macro-economic policy framework, investment climate in the host country, investment policies of the transnational corporations and other commercial considerations,” the Minister said.
On the implementation of the controversial GAAR or General Anti Avoidance Rules, which are to come into effect from next fiscal, Sitharaman said government is “working” on the issue and decision when taken will be informed to the House.
On steps taken to boost FDI, she said various set ups are in place to attract foreign investment. These include five joint commissions with Hungary, Poland, Sweden, Belarus and Libya and CEOs’ forum with nations such as Japan, France, Russia, Malaysia and South Africa.
India has also signed Bilateral Investment Promotion & Protection Agreements with 83 countries and Comprehensive Economic Partnership Agreements with nine countries, she said.