The government is expected to take a decision on liberalising foreign direct investment (FDI) in the politically sensitive multi-brand retail sector soon.
"We are soon going to take a decision on FDI in multi brand retail. We are in consultations with other five-six ministries," Minister of State for Commerce and Industry Jyotiraditya Scindia today said.
At present, 51% FDI is allowed in single-brand retail, while foreign investment is prohibited in multi-brand retail. However, 100% FDI is permitted in the wholesale cash-and-carry segment.
Many domestic retailers, as well as international chains like Wal-Mart, Tesco, Carrefour and Metro have been lobbying with the government here to open up the sector further, including allowing FDI is multi-brand segment.
The industry ministry is in the process of evaluating the comments, which it has received on its discussion paper on liberalising FDI in multi-brand retail and defence sector.
"We are also in a process to make a consensus paper," Scindia said on the sidelines of the inauguration of the four-day international food and hospitality fair Aahar 2011.
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On declining FDI in the country, he said that may be by next month it will start reviving.
FDI in India plunged to about 25% in April-January 2010-11 to $17 billion over the same period last year.
On imposition on Minimum Alternative Tax (MAT) on special economic zones (SEZs), he said that the Commerce Ministry is in consultation with its Finance counterpart on the issue.
"We are in dialogue with them and we certainly hope that the Ministry of Finance will give adequate importance to this. We have requested them to continue the policy and we have complete confidence that Finance Ministry will accept it," he added.
Finance Minister Pranab Mukherjee has proposed to levy Minimum Alternate Tax (MAT) of 18.5% on the book profits of Special Economic Zone (SEZ) developers and units. The changes in the tax rate would be effective April 2012.
Both developers as well as units in the tax-free enclaves were earlier exempted from MAT under Section 115 JB of the Income Tax Act.