FDI in India: Single-brand and Multi-brand Retail

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EXCERPTS

FDI IN RETAIL (1990-2006)

The retail industry in India was highly fragmented and unorganized before the 1990s. Family-owned small stores, popularly known as mom-and-pop stores, were the major players. After the policy of liberalization in 1991, there was a reduction in custom duties and a shift from quota to a tariff-based system. This led to a more liberal policy toward wholesale trade, franchising, and commission agents’ services. The FDI in retail began after India became a member of the World Trade Organization (WTO) in 1995 and the General Agreement on Trade in Services (GATS), which included the wholesale and retailing services, came into existence...

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FDI IN RETAIL (2012-2015)

In January 2012, India approved reforms for single-brand stores welcoming anyone in the world to innovate in the Indian retail market with 100% ownership. But it imposed the requirement that the single brand retailer should source 30 percent of its goods from India. In June 2012, Swedish company IKEA applied to invest $1.9 billion in India and set up 25 retail stores...

FDI POLICY 2015

The government announced easing of several conditions for single brand retail and e-commerce in 2015 whereas the norms of FDI in multi-brand remained unchanged. This move was taken in order to boost the entire investment environment and to stimulate the inflow of foreign investments in the country, opined experts...

EXHIBITS

Exhibit I: Industrial Policy 1991

Exhibit II: Key Developments in the Single Brand Retail Sector During 2012 to 2015

Exhibit III:Market Size of Indian Retail Industry

Exhibit IV:Initiatives in the Indian Retail sector (2014-15)

Exhibit V:FDI Inflows from Different Counties