Multi-brand retail gates may open

Even as political pressure is mounting against opening up the retail sector, the government is once again trying to allow foreign direct investment (FDI) in multi-brand retailing.

Presently, foreign retail companies are forced to enter into licensing agreements with Indian companies to sell their products in India, as the existing rules only permit up to 49 per cent FDI in single-brand retail ventures.

It is learnt that even if the government convinces its “difficult” allies, the Left parties, such investments will come with strict conditions.

There will be constraints on the role and functioning of the foreign partner in the Indian venture.

The foreign partner will enjoy a very limited role in the management of the venture and its hands will be tied on several counts. Surely, foreign firms don’t mind getting just a foot into the retail party.