Even as the modern retail sector in India was awaiting an announcement on further liberalising the country’s foreign direct investment policy, the Union Budget for FY 2011-12, presented in Parliament by Finance Minister Pranab Mukherjee on February 28, played it safe by ‘ignoring’ the issue altogether.
The finance minister’s ‘failure’ to mention opening of the multi-brand retail to foreign investments, however, left the industry disappointed.
“The budget has made no mention of FDI in retail, which is a great disappointment since the sector seriously requires the benefit of foreign investments into multi-brand retailing,” said Anuj Puri, chairman & country head, Jones Lang LaSalle India.
"It would seem that the Union Budget 2011 pointedly ignored the larger issues affecting the Indian real estate sector at this sensitive stage of revival and growth," Puri added.
Basic customs duty on raw silk has been reduced from 30 to 5 per cent, which will have a positive impact on ethnic wear retailers.
Commenting on the budget, Navin M Raheja, chairman, Raheja Developers and Assocham real estate committee said, "The budget is more focused on rural and social development of the country. Emphasis has been given to infrastructure and rural development. Overall budget is good for the general public. But it fails to the expectations of real estate and SEZs. FM has not considered any of the demands of the realty sector."
The investment in cold storage projects is gaining momentum, said Finance Minister Pranab Mukherjee. During this year, he said, 24 cold storage projects with a capacity of 1.4 lakh metric tonnes have been sanctioned under the National Horticulture Mission. In addition, 107 cold storage projects with a capacity of over five lakh metric tonnes have been approved by the National Horticulture Board.
– IndiaRetailing Bureau