FDI in e-commerce: Nasscom for mandatory local sourcing
Oct 31 2013 , New Delhi
"After much delay, Nasscom has finally submitted their recommendations to the DIPP yesterday. They have favoured permitting FDI in e-commerce in the retail sector. However, it has asked to impose conditions on local sourcing," an official told PTI.
Last month, Nasscom President Som Mittal had met DIPP Secretary Saurabh Chandra on the matter. Mittal was asked to submit the industry body's views on the matter.
The Department of Industrial Policy and Promotion (DIPP), under the Commerce and Industry Ministry, deals with foreign direct investment (FDI) related matters.
The official said the DIPP would now formulate a discussion paper on allowing FDI in e-commerce activities, which will also include selling of insurance and shares, besides retail.
"The issue requires wider consultations. E-commerce is not related only with retail. It includes financial services like insurance and shares," the official said.
Global online retailer Amazon.Com has sought relaxation in the FDI policy which restricts such companies from offering services directly to retail consumers.
At present, 100 per cent foreign direct investment (FDI) is allowed in business-to-business (B2B) e-commerce and not in retail trading. Besides, there is a mandatory 30 per cent local sourcing norms for foreign players.
Several global retailers have already raised their concerns over the sourcing norm.
As per the foreign direct investment policy for multi-brand retail trading, at least 30 per cent of the value of procurement of manufactured/processed products shall be sourced from Indian 'small industries'.