Fema-fdi
P.C. Joshi
(Querist) 20 May 2014
This query is : Resolved
Dear Friends, first of all I want to confirm the existing FDI limit in retail. As per my knowledge the same is as under: 1. Single Brand retail: 100 FDI allowed(49% sutomatic route in excess of 49% with Central Govt. Multiple Brand Retail- No FDI is allowed even with Govt. approval. Now my query is: A Ltd deals in whole sale trade and has FRI of about 30%. It wants to operate in retail sector with multiple brands but can'nt do retail sale under FDI policy. However A ltd has a private company in the same gropu in which there is no FDI.But Directors and Indian shareholders are same in both the company. Can this Private company can do retail/online/e commece business with customers directly after buying the goods from A Ltd. as its wholesale/distributor.Please advise. Thansk
& Regards, P.C. Joshi
T. Kalaiselvan, Advocate
(Expert) 22 May 2014
You can visit the SEBI and other share market related web sites to have a first hand knowledge on the subject to enrich your academic knowledge on the subject.
R.V.RAO
(Expert) 22 May 2014
Please see the the website of Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce & Industry, Government of India at www.dipp.gov.in for details regarding sectors and investment limits therein allowed ,under FDI.
Since ,you refer to multi brand retail, in your query,the following few lines are of interest in this context.read carefully before jumping to any action immediately due to change of guard at the centre.wait and see for a while.then pl. come back with your query in the new context.
"Though the Bharatiya Janata Party (BJP)'s election manifesto has categorically opposed foreign direct investment (FDI) in multi-brand retailing to "protect the interests of small and medium traders," the new government is unlikely to reverse the existing policy.
In a recent interview, Narendra Modi, set to take charge as prime minister in a few days, had said his government wouldn't roll back any policy in the sector.
The policy could be modified. Sources said there might be a move to lower the FDI cap in multi-brand retail from 51 per cent to 49 per cent over a period, perhaps to make the entry of global companies tougher. It was suggested sourcing norms in the retail sector might be gradually eased."
SOURCE:
http://www.business-standard.com
