FDI in retail if kiranas are safe: Sahai

Hinting that the government may open up the retail industry to more foreign direct investment (FDI), Minister of State for Food Processing Industries Subodh Kant Sahai lashed out at 'jobless ex-politicians' for rasing cheap slogans saying they were only hurting farmers.

"India may open up its $330 billion retail market after being convinced that kirana stores will not be affected by big retailers," Sahai said at a function organised by FICCI.

He said the Department of Industrial Policy and Promotion (DIPP) has engaged an agency for an in-depth study on the impact of FDI in retail on mom-and-pop stores and its report is expected in March next year.

Sahai, however, allayed fears that big retailers were going spell doom for small players. "This myth has to be cleared and there are no reports which says that," he said, adding that the opponents of organised retail, which could play a key role in changing the agriculture scenario of the country, were ill-informed.

"Some people, particularly ex-politicians without jobs, are making cheap slogans (against organised retail) without actually realising that they were hurting the farmers," the minister said.

"Kiranawalas (small retail stores) are everywhere... they are not being harmed at all," he added.

Sahai said the government's main aim was to provide jobs to the farmers, which could happen in a big way when the retailing industry grows in India. "Contract farming has also become another topic of debate, but the government is clear that if we want to help farmers we need to have farmers in cluster farming," Sahai said, adding that it could happen only if the retail sector develops in a big way.

The minister said in the 11th Plan, the govenrment will provide a provision of Rs 10 crore for integrated supply chain besides mulling tax incentives for the develpoment of other infrastructures such as cold chains.

The government is also conducting a feasibility study of setting up mega food parks across the country for linking farmers with the retail markets. "It is tentatively envisaged to support 30 mega food parks spread across the country," Sahai said.