New Delhi: Walmart Stores Inc, the world's largest retailer, is in no hurry to open retail stores in the country,

even as the government allowing foreign investment (FDI) in multi-brand segment.

The company currently operates a 50:50 joint venture (JV) with the Bharti Group for wholesale cash and carry.

In response to a query on whether Walmart would be interested to enter the front-end retailing in India, Walmart India president Raj Jain said: "Of course, that's the whole idea. We are in wholesale at present, and now that FDI in multi-brand retail is allowed, we are definitely interested in it."

The retailer, however, says it would have to study the policy fully and evaluate before finalising its future course of action.

Currently, Walmart's JV with the Bharti Group - Bharti Walmart - runs 17 Best Price Modern Wholesale stores in different parts of the country. The JV is expected to open a total of 12-15 such stores in India this year.

Bharti Walmart is a major supplier to Bharti Retail, which runs more than 205 retail stores in different formats under the Easyday brand.

"By being 'stores of the community', we will also help them live better. We are willing and able to invest in back-end infrastructure that will help reduce wastage of farm produce, improve livelihood of farmers, lower prices of products and ease supply-side inflation," Jain added.

Meanwhile, Swedish home furnishings major Ikea has said it will open stores in the country only after the government approves its application in entirety although sourcing norms for FDI in single-brand retail have been diluted.

The government on Friday tweaked the sourcing norms for FDI exceeding 51 per cent in singlebrand retail and diluted the previous condition of sourcing 30 per cent of requirements from micro, small and medium enterprises (MSMEs) in India by stating that sourci

New Delhi, Sep 14 (ANI): The Cabinet Committee on Economic Affairs on Friday approved Foreign Direct Investment (FDI) in retail, civil aviation, broadcast and power sectors. The government decided to notify the Cabinet decision on FDI in multi-brand retail. This would mean retail giants like Walmart could come to India with stores where they can hold up to 51 percent equity.

The CCEA, headed by Prime Minister Dr Manmohan Singh, also approved disinvestment in three public sector units (PSUs). The government also approved 49 percent FDI in the civil aviation sector, which would provide oxygen to the ailing carrier like Kingfisher Airlines. Relaxing FDI rules will help bring a much-needed cash flow to India's bleeding private airlines. FDI in information and broadcasting and power sectors were also approved. In November last year, the government had approved 51 percent FDI in multi-brand. This was, however, put on hold due to political opposition, including from UPA constituent Trinamool Congress. The government had earlier proposed to allow the 450 billion dollars supermarket sector to foreign firms such as Wal-Mart, but had suspended the decision to allow such investment in multi-brand retailing due to opposition from several parties, including some UPA allies. West Bengal Chief Minister Mamata Banerjee, who has 16 Lok Sabha MPs and is the second-largest member of the ruling UPA coalition, has so far opposed the FDI in key sectors like retail, insurance and aviation. She had earlier claimed that FDI in these sectors would be harmful for the people of the country. (ANI) Two years would be a reasonable time frame in total," he added. The move comes after the government last week agreed to allow megastore retailers to enter the country through joint ventures in its FDI in retail policy. Walmart, the world's biggest retailer, has not yet decided where or how many stores it would like to have in India, Price told the newspaper. At present Walmart has a 50:50 cash and carry joint venture with Bharti Group, while Carrefour runs wholesale stores. Tesco, on the other hand has a tie-up with the Tata group and supports the Indian firm in the running of Star Bazaar chain of retail outlets. Price added that the company expects to continue its current partnership with Bharti Enterprises in a chain of 17 cash-and-carry stores, but it is not in discussions with any other company for a potential retail partnership. Price told that he was confident that the reform would be permanent and said the company is committed to India's long-term future. Showing resolve for reforms, the government yesterday had notified its decision to allow global retail giants like Walmart to open stores in India, on a day several political parties called Bharat Bandh to protest against the policy. With this notification, multinational retailers can invest up to 51 per cent to open stores in 10 states and UTs which, till date, have agreed to implement the decision.

"51 per cent FDI in multi-brand retailing, in all products, will be permitted ...," a notification by the Department of Industrial Policy and Promotion (DIPP) said. It said the decision will take immediate effect. The DIPP also operationalised September 14 Cabinet decisions to relax the sourcing norms for foreign retailers investing beyond 51 per cent in single-brand retail and allow 49 per cent FDI by foreign airlies in the domestic carriers.

Policy on Foreign Direct Investment

India has among the most liberal and transparent policies on FDI among the emerging economies. FDI up to 100% is allowed under the automatic route in all activities/sectors except the following, which require prior approval of the Government:1. Sectors prohibited for FDI 2. Activities/items that require an industrial license 3. Proposals in which the foreign collaborator has an existing financial/technical collaboration in India in the same field 4. Proposals for acquisitions of shares in an existing Indian company in financial service sector and where Securities and Exchange Board of India (substantial acquisition of shares and takeovers) regulations, 1997 is attracted 5. All proposals falling outside notified sectoral policy/CAPS under sectors in which FDI is not permitted Most of the sectors fall under the automatic route for FDI. In these sectors, investment could be made without approval of the central government. The sectors that are not in the automatic route, investment requires prior approval of the Central Government. The approval in granted by Foreign Investment Promotion Board (FIPB). In few sectors, FDI is not allowed. After the grant of approval for FDI by FIPB or for the sectors falling under automatic route, FDI could take place after taking necessary regulatory approvals form the state governments and local authorities for construction of building, water, environmental clearance, etc. Manual for FDI brought out by the Department of Industrial Policy and Promotion provides details about FDI Policy and Procedures and is available at http://www.dipp.nic.in/manual/FDI_Manual_Latest.pdf All Press Notes of Department of Industrial Policy and Promotion that provides details about FDI policy are available at their website http://siadipp.nic.in/policy/changes.htm . FDI policy is also notified by Reserve Bank of India (RBI) under Foreign Exchange Management Act (FEMA) and could be seen at www.rbi.org.in. Top

Procedure under automatic route

FDI in sectors/activities to the extent permitted under automatic route does not require any prior approval either by the Government or RBI. The investors are only required to notify the Regional Office concerned of RBI within 30 days of receipt of inward remittances and file the required documents with that office within 30 days of issue of shares of foreign investors.

Procedure under Government Approval

FDI in activities not covered under the automatic route require prior government approval. Approvals of all such proposals including composite proposals involving foreign investment/foreign technical collaboration is granted on the recommendations of Foreign Investment Promotion Board (FIPB). Application for all FDI cases, except Non-Resident Indian (NRI) investments and 100% Export Oriented Units (EOUs), should be submitted to the FIPB Unit, Department of Economic Affairs (DEA), Ministry of Finance. Application for NRI and 100% EOU cases should be presented to SIA in Department of Industrial Policy and Promotion. Application can be made in Form FC-IL. Plain paper applications carrying all relevant details are also accepted. No fee is

payable. The guidelines for consideration of FDI proposals by the FIPB are at Annexure-III of the Manual for FDI. Form FC-IL - COMPOSITE FORM FOR FOREIGN COLLABORATION AND INDUSTRIAL LICENCE http://siadipp.nic.in/download/il-form.doc IEM Form http://siadipp.nic.in/policy/policy/ip202.htm Manual for FDI http://www.dipp.nic.in/manual/FDI_Manual_Latset.pdf

Prohibited Sectors

The extant policy does not permit FDI in the following cases: i. Gambling and betting ii. Lottery Business iii. Atomic Energy iv. Retail Trading v. Agricultural or plantation activities of Agriculture (excluding Floriculture, Horticulture, Development of Seeds, Animal Husbandry, Pisiculture and Cultivation of Vegetables, Mushrooms etc., under controlled conditions and services related to agro and allied sectors) and Plantations (other than Tea Plantations)

General permission of RBI under FEMA

Indian companies having foreign investment approval through FIPB route do no require any further clearance from RBI for receiving inward remittance and issue of shares to the foreign investors. The companies are required to notify the concerned Regional Office of the RBI of receipt of inward remittances within 30 days of such receipt and within 30 days of issue of shares to the foreign investors or NRIs. Top

Industrial Licensing

With progressive liberalization and deregulation of the economy, industrial license is required in very few cases. Industrial licenses are regulated under the Industries (Development and Regulation) Act 1951. At present, industrial license is required only for the following: 1. Industries retained under compulsory licensing 2. Manufacture of items reserved for small scale sector by larger units 3. When the proposed location attracts locational restriction The following industries require compulsory license: I Alcoholics drinks II Cigarettes and tobacco products III Electronic aerospace and defense equipment IV Explosives V Hazardous chemicals such as hydrocyanic acid, phosgene, isocynates and di-isocynates of hydro carbon and derivatives.

Procedure for obtaining an industrial license

Industrial license is granted by the Secretariat for Industrial Assistance in Department of Industrial Policy and Promotion, Government of India. Application for industrial license is required to be submitted in Form FC-IL to Department of Industrial Policy and Promotion. Form FC-IL - COMPOSITE FORM FOR FOREIGN COLLABORATION AND INDUSTRIAL LICENCE http://siadipp.nic.in/download/il-form.doc

Small Scale Sector

Ministry of Agro and Rural Industries and Ministry of Small Scale industries have been merged into a single Ministry, namely, Ministry of Micro, Small and Medium Enterprises. http://msme.gov.in/

Locational Restrictions

Industrial undertakings to be located within 25 kms of the standard urban area limit of 23 cities having a population of 1 million as per 1991 census require an industrial license. Industrial license even in these cases is not required if a unit is located in an area designated as an industrial area before 1991 or non-polluting industries such as electronics, computer software, printing and other specified industries.

Environmental Clearances

Entrepreneurs are required to obtain Statutory clearances, relating to Pollution Control and Environment as may be necessary, for setting up an industrial project for 31 categories of industries in terms of Notification S.O. 60(E) dated 27.1.94 as amended from time to time, issued by the Ministry of Environment and Forests under The Environment (Protection) Act 1986. This list includes petrochemicals complexes, petroleum refineries, cement, thermal power plants, bulk drugs, fertilizers, dyes, papers etc. However, if investment in the project is less than Rs.1 billion (appox. $ 22.2 million), such Environmental clearance is not necessary, except in cases of pesticides, bulk drugs and pharmaceuticals, asbestos and asbestos products, integrated paint complexes, mining projects, tourism projects of certain parameters, tarred roads in Himalayan areas, distilleries, dyes, foundries and electroplating industries. Setting up industries in certain locations considered ecologically fragile (e.g. Aravalli Range, coastal areas, Doon Valley, Dahanu etc.) are guided by separate guidelines issues by the Ministry of Environment and Forests.

Other approvals/clearances at State level

Land, Water, Electricity, Registrations etc. For further details please refer the website of Ministry of Environment and Forests http://envfor.nic.in Environmental Clearance (EC) Process in India: A new website http://www.ecprocess.nic.in