India's largest traders' association CAIT on Tuesday said few multinational e-commerce giants with a heavy arsenal of funding are attempting to flout foreign investment guidelines for the sector and demanded strict enforcement action. Releasing a whitepaper on the e-commerce policy, the Confederation of All India Traders (CAIT) said e-commerce entities have "structured their relationship as marketplace with sellers in a such a way that they are in a position to control either seller on their platform or the inventory and also escape the scrutiny of the enforcement agencies." "Under the guise of such control or ownership over sellers, the issue also permeates from being a mere FDI policy violation to also being an anti-competitive conduct," it said.
The government on Thursday clarified that the multi-brand retail store set up by a global retail entity will have to be 'company owned and company operated' and not operated by any franchisee.
The Indian government has simplified FDI policy inorder to attract global retail chains.
The United Progressive Alliance government had opened the multi-brand retail sector for foreign investment and allowed up to 51 per cent foreign direct investment in the sector.
Bentonville-based Walmart has also raised apprehensions about the ongoing probe by investigating agency Enforcement Directorate, said an internal note of the Department of Industrial Policy and Promotion.
No one's quite sure on the retail FDI issue in this regard, after the new Rajasthan and Delhi governments cancelled the approvals given by their predecessors
Tesco was the first global retailer to apply for multi- brand retailing in India.
The previous United Progressive Alliance government had permitted up to 51 per cent foreign direct investment in multi-brand retail but the current National Democratic Alliance government is opposed to it.
Before leaving on a 10-day foreign visit starting Monday, Sharma said he would address concerns of foreign retail sector investors and ensure help in setting up stores.
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