 "Lobbies not for a retail regulator")
Two days after the chairman of Parliament’s standing committee on industry, Tiruchi Siva, recommended a retail regulatory authority, major industry associations have come out strongly against the idea.
“The institution of a central regulator for the retail sector would be counterproductive, given the localised operations of the sector,“ said Chandrajit Banerjee, director-general, Confederation of Indian Industry.
He argued retail was a state subject and the multiplicity of Central and state regulators would only hamper efficiency.
D S Rawat, secretary-general of Assocham, said this was just an apprehension and nowhere in the world have smaller shops disappeared. He said they co-existed with larger ones.
Industry insiders said one needs to obtain 20-50 approvals. “Another regulator could impede rather than enable growth,” said Bhaskar Bhatt, chairman, CII’s National Committee on Retail.
In a press conference earlier, Standing Committee chairman Tiruchi Siva had said that foreign direct investment (FDI) in retail could squeeze out local retailers and cause “loss of livelihood that could add to the already-existing social and economic woes, which generate so much unrest and violence”. He emphasised the need for regulation by arguing this move would be in the interest of consumers and farmers.
To this, D S Rawat, secretary-general of Assocham, responded that this is just an apprehension and nowhere in the world have the smaller shops disappeared. He said both co-exist. Banerjee added that organised retail will “creates jobs up and down the supply chain, including in manufacturing and services, extending beyond trading and MSME (micro, small and medium enterprises)”. Adding a note of caution, he said that any move to place a central regulatory authority would need to be studied in all its dimensions for its impact on employment, inflation and income generation.
Industry insiders pointed out that currently, one needs to obtain some 20-50 approvals depending on the type of product and business. A retail regulatory authority could further lower the morale of the sector, they argued. “Another regulator could impede rather than enable growth”, said Bhaskar Bhatt, chairman, CII’s National Committee on Retail.
Anand Sharma, minister of commerce and industry, had on Tuesday responded to the suggestion of regulatory authority by saying “these are executive functions and these are not functions to be dealt by the Standing Committee”.
Speaking to Business Standard, Siva, however, defended his report. The report is the mandate of the Standing Committee, which has the authority to give recommendations to Parliament, he argued. “In the current policy, there is lack of clarity and the impact of this policy needs to be studied in a proactive manner so that we can avoid problems of the future.”
The Cabinet is expected to take up the issues in multi-brand retail soon. These issues include definition of small and medium enterprises (SME), 30 per cent sourcing from SMEs and other issues relating to the investment in the back-end infrastructure, which were raised by the key retail players in a meeting with Commerce and Industry Minister Anand Sharma last month.
“The institution of a central regulator for the retail sector would be counterproductive, given the localised operations of the sector,“ said Chandrajit Banerjee, director-general, Confederation of Indian Industry.
He argued retail was a state subject and the multiplicity of Central and state regulators would only hamper efficiency.
D S Rawat, secretary-general of Assocham, said this was just an apprehension and nowhere in the world have smaller shops disappeared. He said they co-existed with larger ones.
Industry insiders said one needs to obtain 20-50 approvals. “Another regulator could impede rather than enable growth,” said Bhaskar Bhatt, chairman, CII’s National Committee on Retail.
In a press conference earlier, Standing Committee chairman Tiruchi Siva had said that foreign direct investment (FDI) in retail could squeeze out local retailers and cause “loss of livelihood that could add to the already-existing social and economic woes, which generate so much unrest and violence”. He emphasised the need for regulation by arguing this move would be in the interest of consumers and farmers.
To this, D S Rawat, secretary-general of Assocham, responded that this is just an apprehension and nowhere in the world have the smaller shops disappeared. He said both co-exist. Banerjee added that organised retail will “creates jobs up and down the supply chain, including in manufacturing and services, extending beyond trading and MSME (micro, small and medium enterprises)”. Adding a note of caution, he said that any move to place a central regulatory authority would need to be studied in all its dimensions for its impact on employment, inflation and income generation.
Industry insiders pointed out that currently, one needs to obtain some 20-50 approvals depending on the type of product and business. A retail regulatory authority could further lower the morale of the sector, they argued. “Another regulator could impede rather than enable growth”, said Bhaskar Bhatt, chairman, CII’s National Committee on Retail.
Anand Sharma, minister of commerce and industry, had on Tuesday responded to the suggestion of regulatory authority by saying “these are executive functions and these are not functions to be dealt by the Standing Committee”.
Speaking to Business Standard, Siva, however, defended his report. The report is the mandate of the Standing Committee, which has the authority to give recommendations to Parliament, he argued. “In the current policy, there is lack of clarity and the impact of this policy needs to be studied in a proactive manner so that we can avoid problems of the future.”
The Cabinet is expected to take up the issues in multi-brand retail soon. These issues include definition of small and medium enterprises (SME), 30 per cent sourcing from SMEs and other issues relating to the investment in the back-end infrastructure, which were raised by the key retail players in a meeting with Commerce and Industry Minister Anand Sharma last month.