New Delhi, Apr 6 (KNN) Government today released a new edition of a consolidated FDI policy incorporating , among others, the policy changes under which foreign investment up to 51 per cent was allowed in the multi-brand retail and raised to 100 per cent in the single brand.
 
The circular issued by the Department of Industrial Policy and Promotion (DIPP) said that  the foreign multi-brand retail chains will have to procure at least 30 per cent of  manufactured/ processed products from Indian 'small industries' which have a total investment in plant and machinery not exceeding USD one million.
 
“This valuation refers to the value at the time of installation, without providing for depreciation. Further, if at any point in time, this valuation is exceeded, the industry shall not qualify as a 'small industry' for this purpose.  This procurement requirement would have to be met, in the first instance, as an average of five years’ total value of the manufactured/ processed products purchased, beginning 1st April of the year during which the first tranche of FDI is received. Thereafter, it would have to be met on an annual basis,” the circular said. 
 
In respect of proposals involving FDI beyond 51 per cent in single brand, sourcing of 30 per cent of the value of goods purchased will be done from India, preferably from MSMEs, village and cottage industries, artisans and craftsmen, in all sectors.
 
The quantum of domestic sourcing will be self-certified by the company, to be subsequently checked, by statutory auditors, from the duly certified accounts which the company will be required to maintain.
 
For the purpose of ascertaining the sourcing requirement, the relevant entity would be the company, incorporated in India, which is the recipient of FDI for the purpose of carrying out single-brand product retail trading.    (KNN)
 
 
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