100 per cent FDI proposed in food processing

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The government proposes to open up food processing to fo­reign companies by allowing th­em 100 per cent investment in the sector provided they sell pro­ducts manufactured only in India. Stating that 100 per cent for­eign direct investment (FDI) will benefit farmers and create vast employment opportunities, finance minister Arun Jaitley, in his budget speech, said that a lot of fruits and vegetables either did not fetch the right price or failed to reach the market.

“Our FDI policy has to address the requirements of farmers and food processing industry. Food processing industry and tra­de should be more efficient. 100 per cent FDI will be allowed thr­ough FIPB route in marketing of food products produced and ma­nufactured in India. This will be­nefit farmers, give impetus to fo­od processing industry and crea­te vast employment opportuniti­es,” Jaitley said.

“Allowing 100 per cent FDI through FIPB for the marketing of food products produced and manufactured in India is a welcome step and it would encourage investment in food business in India,” said Future group CEO Kishore Biyani.

Food processing minister Harsimrat Kaur Badal had sought 100 per cent FDI in marketing and retail of those food products which are produced and proc­es­sed in India. She argued that big companies would create infrastr­ucture and bring the latest technology in the agriculture sector.

Currently, India permits 51 per cent FDI in the multi-brand retail. So far, the governm­ent has cleared the UK-based Te­sco’s proposal in multi-brand retail. However, 100 per cent FDI is permitted in single brand retail and multi-brand wholesale business.

Walmart India may be able to expand its footprint in retail.

“The decision is very progressive and will help in reducing wa­stage, help in farm diversification and encourage industry to produce locally within the country,” said Krish Iyer, president and CEO, Walmart India.

prabhudatta.m@mydigitalfc.com

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