Clearing government stand on FDI in multi-brand retailing, Commerce and Industry Minister Nirmala Sitharaman on Wednesday said the NDA government will not “entertain” foreign direct investment in multi-brand retail.
She said during Question Hour in Rajya Sabha that BJP got a massive mandate on the basis of its election manifesto which opposes FDI in multi-brand retail.
However, the government has not initiated any move to scrap the policy of allowing FDI in multi-brand retail approved by the previous UPA government.
“The mandate given to government is on the basis of our manifesto…We do not entertain FDI in multi-brand retail,” she said.
She said FDI flow have not been consistent in past few years. “During the last three years FDI inflow has fluctuated. FDI inflow decreased by 26.33 percent in 2012-13 and increased by 6.12 percent in 2013-14,” she said.
FDI flow is dependent on the business environment and how decisions are made, she said, adding FDI inflow has been skewed in favour of Mauritius.
Mauritius accounted for USD 80.809 billion out of USD 222.89 billion that came to India between 2000 and 2014.
“We are using FIPB to carry out check (on investing companies),” she said.
Even in sectors where FDI is allowed under automatic route, RBI scrutinises the funds flow, she said.
RBI and Department of Revenue through FIPB takes critical look at the kind of investment coming into India, she said.
“Under the liberalised economic environment, investment decisions of investors are based on the macro-economic policy framework, investment climate in the host country, investment policies of the trans-national corporations and other commercial considerations,” the Minister said.