India Inc. Monday reacted cautiously to the Bharatiya Janata Party's (BJP) manifesto for the Lok Sabha elections, which says the party would attract foreign investment in areas that create jobs and keep foreign capital out of multi-brand trade.
"We feel disappointment on the stand on FDI in Multi-Brand Retail, we hold out hope for a possible review in the future," said Ficci president Sidharth Birla, while welcoming an investment-friendly environment and linking of foreign investment to jobs.
"BJP manifesto outlines multiple measures for inclusive development, with focus on governance, growth and employment. These are arguably the key concerns facing the economy today."
The Associated Chambers of Commerce and Industry (Assocham) said it will impress upon the BJP to reconsider its stand on multi-brand retail, as this sector has the potential for a multiplier effect on the Indian economy without disturbing neighbourhood stores.
In its manifesto, the BJP said it will also make the Foreign Investment Promotion Board (FIPB) more efficient and investor-friendly, and promised to make the tax regime simple. It accused the present government of unleashing "tax terrorism" and "uncertainty."
On proposed goods and services tax (GST), the party said it would bring on board all state governments and address their concerns.
Assocham welcomed the principle opposition party's focus on building important infrastructure and giving a boost to urbanisation by building 100 new cities.
According to Rajrishi Singhal of the Mumbai-based foreign policy think tank Gateway House, concerns of mom-and-pop store owners have stopped the BJP's manifesto from eradicating supply chain bottlenecks by encouraging FDI in retail trade.
"The manifesto is unequivocally clear that it will not allow foreign direct investment in multi-brand retail, in keeping with its recent public announcements. Voter interest also stops it from chipping away at the multiple layers that add to food supply chain inefficiencies and food inflation," said Singhal .
Singhal added that the BJP's manifesto vows to build 100 new cities, however, it does not furnish details of the time-frame in which this would be done.
