The foreign direct investment (FDI) in the retail sector has been in the backburner for a long time now. It appears the cabinet might clear the FDI in retail. It comes with a lot of conditions that at a minimum USD 100 million will have to be bought and half of it should be back into the infrastructure.
Nikhil Chaturvedi, managing director of Provogue believes that the FDI in retail will focus on Tier 1 cities. He also indicated that this thought excites a lot of participation. Below is the edited transcript of his interview to CNBC-TV18. Also watch the accompanying video. Q: What's your sense? Assuming these caveats, will there be a lot of interest on global majors to tie up with Indians?
A: Yes, surely. A lot of majors have been sitting on the edges from the last three or four years. They will be very excited about the way this is opening up. It was high time for this to open up.
The need for foreign capital in the Indian retail sector was not doubted by anyone. This is a major positive step and it will have the right reaction across the markets. Q: Are you in conversation with any global retailers and international brands which have shown interest to join?
A: The international brands have been coming to India and studying the environment. Till there is not a clear policy framework, they would keep dipping their toes and checking what the environment is like. Q: A couple of riders may deter some investors from coming in. The government will allow these chains to operate in large cities only. How does that change the entire prospects because the Tier 2 and Tier 3 cities have a lot of upcoming demand?
A: For every retailer who are coming into the country, they would want to enter in Tier 1 first, and then to Tier 2 and Tier 3. It
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