Amid suggestions for opening up of multi-brand retail for foreign investments, finance minister Pranab Mukherjee on Wednesday said discussions were on to further liberalise the FDI policy.  “Discussions are underway to further liberalise the FDI (foreign direct investment) policy,” he said at the annual conference of chief commissioners and directors general of Central Board of Excise and Customs ( CBEC )) at New Delhi.
He said with an aim to make the FDI policy user friendly, all prior regulations and guidelines have been consolidated into an comprehensive document. The document is reviewed every six months.

Mukherjee’s statement comes within weeks of an Inter-ministerial Group (IMG) headed by Chief Economic Advisor Kaushik Basu recommending to the government opening up the multi-brand retail sector for FDI to tame inflation.

The IMG constituted in February by Prime Minister Manmohan Singh had favoured opening of the sector in a calibrated manner.

Last July, the industry department had initiated discussions on opening the sector for FDI.

The share of organised retail in the total retail trade happens to be just over 4 per cent in India. The unorganised retail sector employs about 33 million people.

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0 responses to “Discussions on to further liberalise FDI in Multi Brand Retail – Pranab Mukherjee”

  1. Sonu says:

    This is the exemplary of the extent to which financial advisers could be suborned. Kaushik Basu’s recommendation is merely lobbying in favour of foreign retail stores like Walmart. Read the disproof of the contention that FDI in multi-brand retail would help mitigate inflation, by Anil Raghuraj

  2. hemen parekh says:

    Magic Wand ?

    Is there a magic wand with which India can

    Bring back black money stashed abroad

    Stop generation of further tax evasion

    Prime Minister Man Mohan Singh says, “ No “.

    He is an eminent economist and he should know.

    But let him at least consider following :

    For the past tax evaders

    • Without asking any questions as to the source of their funds, let them bring in those black monies stashed abroad and invest into Government approved “ Infrastructure Bonds / SPVs “.

    • They can take out these monies only after 15 years

    • During this period, they will not get any profit / interest / dividend etc from their investments. This “deprivation” becomes their only penalty.

    * All the profits earned by these Bonds/SPVs, to be deposited into a “ Honest Tax Payers Tax Reduction Account” (HTPTRA), held by Government.

    * During these 15 years, they will continue to pay their income tax on their other incomes @ 35 % normal rate

    For the honest tax payers

    • The amount deposited into HTPTRA to be used to bring down the maximum tax rate payable by the honest tax payers. The reduction could be 1% – 2% per year, till the maximum payable tax rate is brought down to 15 %

    • This will be a “ Reward “ to the honest tax payers and will discourage tax evasion.

    I am not suggesting this as a some kind of substitute for tax-evasion treaties to be signed with all the countries.

    But to tackle this issue, we also need a permanent / structural / internal / motivational mechanism as well.

    With a maximum personal income-tax rate of 15 %, Singapore has no black-money problem !

    There may be a Magic Wand after all !

    With regards

    Hemen Parekh

    Jobs for All = Peace on Earth

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