News: Govt to study big investment, FDI in retail

(PTI 27/02/2007) New Delhi - Under pressure from the Prime Minister's Office (PMO), the Commerce Ministry today said it has commissioned a study on the impact of foreign direct investment (FDI) and big corporates in the retail sector. "I have asked Indian Council of Research in International Economic Relations (ICRIER) to do a holistic study to determine the impact of big investment from the organised sector, including FDI, in retail on not only small shops, but also the other segments of the society," Commerce and Industry Minister Kamal Nath said. ICRIER would submit its report in the next three to four months. Earlier this month, Congress President Sonia Gandhi, buckling under pressure from the Left parties and others, had written to Prime Minister Manmohan Singh on the need for a 'careful study' of the impact of transnational supermarkets and big corporates on livelihood of small scale retailers and vendors. The PMO had in turn asked the Commerce Ministry to look into it. Nath said the study would not limit itself to the impact on small players but would cover consumers, suppliers and dislocation. "It would deal with the issue of big versus small and not just FDI," Nath said. Interestingly, in an earlier study the think-tank had favoured FDI in retail. Nath said, while the review of FDI in specific sectors was an ongoing process, the ministry's proposal to open foreign investment in electronics and sports goods among others could slightly be delayed till the report is received.