Home / Knowledge / News / Apparel/Garments / Indian govt eases norm for FDI in single-brand retail
Indian govt eases norm for FDI in single-brand retail
02
Aug '13
The Government of India has decided to amend the provision related to foreign direct investment (FDI) route in single-brand retail, including apparel retail trading.
 
At a meeting, the Union Cabinet approved the proposal to allow up to 49 percent FDI in single-brand product retail trading through the automatic route.
 
Earlier, all the FDI proposals by single-brand retail companies were subject to the Government approval.
 
The existing paragraphs 6.2.16.4 (2) (d) and 6.2.16.4 (3) of ‘Circular 1 of 2013-Consolidated FDI Policy’ have now been changed.
 
The revised para 6.2.16.4 (2) (d) now reads: “A non-resident entity or entities, whether owner of the brand or otherwise shall be permitted to undertake ‘Single Brand’ product retail trading in the country for the specific brand, directly or through a legally tenable agreement with the brand owner for undertaking single brand product retail trading.”
 
However, the onus for ensuring compliance with this condition will rest with the Indian entity carrying out single brand product retail trading in India.
 
The investing entity shall provide evidence to this effect at the time of seeking approval, including a copy of the licensing/ franchise/sub-license agreement, specifically indicating compliance with the above condition.
 
The requisite evidence should be filed with the Reserve Bank of India (RBI) for the automatic route and Secretariat for Industrial Assistance (SIA)/Foreign Investment Promotion Board (FIPB) for cases involving approval of the Government i.e. where the investment in single-brand retail is between 49 percent and 100 percent.
 
The amended para 6.2.16.4 (3) now states, “Application seeking permission of the Government for FDI exceeding 49% in a company which proposes to undertake single brand retail trading in India would be made to the Secretariat for Industrial Assistance (SIA) in the Department of Industrial Policy and Promotion (DIPP).”
 
“The applications would specifically indicate the product/ product categories which are proposed to be sold under a ‘Single Brand’. Any addition to the product/ product categories to be sold under ‘Single Brand’ would require a fresh approval of the Government. In case of FDI up to 49% the product/ product categories proposed to be sold except food products would be provided to the RBI.” 
 
The FDI entry route in single-brand retail has been liberalized by the Government with a view to stimulating FDI inflows in to the country, and thereby contributing to growth of investment, incomes and employment.
 
The latest decision of the Government has been taken in the backdrop of fairly modest FDI inflows over the last year and lack of growth in gross domestic capital formation.
 

Fibre2fashion News Desk - India


Must ReadView All

Courtesy: European Commission/European Union

Textiles | On 26th May 2018

EU set to negotiate FTAs with Australia & New Zealand

The European Union is all set to begin negotiations for free trade...

US bans import of cotton goods from Turkmenistan

Textiles | On 26th May 2018

US bans import of cotton goods from Turkmenistan

The US Customs and Border Protection (CBP) has issued a Withhold...

FPCCI prepares report on Pakistan's export issues

Textiles | On 26th May 2018

FPCCI prepares report on Pakistan's export issues

Federation of Pakistan Chambers of Commerce and Industry (FPCCI)’s...

Interviews View All

Kaizad Hansotia
GetNatty

Competition is the best thing that can happen to a startup

Marazban F Velati
Sutlej Textiles & Industries limited

No training can be effective till the candidate believes in it.

Representatives
Textile & apparel industry

GST is a complicated and lengthy process

Kamal Kulshreshth

Colorjet is among the fastest-growing wide format digital inkjet print...

Rajat Jaipuria

Activewear brand Soul Space promotes organic cotton farming and...

C Dhandayuthapani

MAG Solvics Private Limited was established in 1991 to design and develop...

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Eric Scholler
Groz-Beckert

The Indian market has huge potential in technical textiles, and by far,...

Cigdem Akin
Cigdem Akin

She has carved a niche for herself as the national brand of Turkey. Her...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


May 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Advanced Search