More work to be done on multi-brand retailing: Ajay Dua

The government today clarified that the multi-brand retail store set up by a global retail entity will have to be 'company owned and company operated' and not operated by any franchisee.

Ajay Dua, former DIPP Secy, thinks that there is still more work to be done. "A lot more work has to be done before people would be really satisfied that the conditions which have been imposed can be operated", he added. Also read: Expect nothing major in FDI in retail before elections: JSA
     
Below is the verbatim transcript of his interview to CNBC-TV18 Q: Let's get you to respond to the comment that Siddharth Zarabi just made and the lawyers on the panel also saying that this was perhaps necessary to specify that the front end retail outlets will be company owned and company operated and you cannot take the franchise route? A: I totally agree with what is being said right now. We haven’t thought through the entire process of the implications of the various conditions which have been imposed on getting multi-brand retail into the country. The very fact that we had these conditions of sourcing, investing in infrastructure etc, when we impose these we also needed to clarify all the operational aspects, lay down the ground work needed to be done much earlier. That is why for almost eight months after we have opened up we haven’t received any application for multi-brand retail in the country. That is my first observation. I think some clarity has been given. We have been getting it in bits and pieces for last few weeks, but I think there is still more work to be done. In fact I would say a lot more work to be done before people would be really satisfied that the conditions which have been imposed can be operated. Q: So, you continue to believe that despite the clarification from the government and in a sense its not so much a clarification, its really a reiteration of its earlier policy that we are not really going to see foreign investors support this by pumping money into India? A: I don’t think what is being clarified is going to be a big game changer today. In fact we need to work very quickly, anticipating issues rather than sort of responding to issues which are matters raised by companies and lay down the ground rules once for all. These will be the rules which have to be followed for next couple of years. Otherwise people will just keep waiting saying that there is going to be some more relaxation after a while, lets wait and watch.