Complexity of doing business affecting foreign interest in Indian retail

It’s not too surprising that despite so many industrial policy reforms India continues to elude a major influx of wholehearted foreign investment.

Blame it on the country having one of the most complex web of retail policies globally. Unlike many other countries which have a streamlined and uniform set of retail policies, the retail industry in India is divided into many segment layers such as single-brand, multi-brand, wholesale, ecommerce – and each is monitored by a different set of FDI policy. All these factors act as a deterrent to many interested foreign parties to invest in the country as they are burdened with confusion and often face regulations tough to satisfy.

One of the latest cases which can be cited is that of the tightly sewn-up, food-only retailing in which 100% FDI is allowed but only on the condition that it entails domestically sourced and manufactured food products to be sold.

 

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