New Delhi: The Clothing Manufacturers Association of India (CMAI) on Tuesday called on the government to grant industry status to the retail sector. The association, representing both large and small retailers and manufacturers, also sought simplification of the existing foreign direct investment (FDI) policy for single brand retail.
On Tuesday, India’s top retailers, including Aditya Birla Fashion and Retail, Bestseller, Biba, TCNS Clothing, Shoppers Stop, along with CMAI, met with government representatives at a closed door meeting to discuss the potential of the retail sector as well as the various challenges. The meeting was attended by Rohit Kansal, IAS, additional secretary, ministry of textiles.
“The big takeaway was that all of us want retail to be recognized as an industry. What happens now is that we are left to the vagaries of various state governments—each following their own rules, which are complex. We all want to be recognized as an industry. Then, the central government will have more of a say in the decision making and policy. Retail should be at par with any other manufacturing industry,” Rahul Mehta, chief mentor CMAI, told Mint on the sidelines of the Bharat Tex event in New Delhi.
Mehta said Indian retailers also raised concerns around ease of doing business for foreign retailers. “The other issue, of course, was the various FDI regulations and ease of doing business. Some (single brand) retailers that have multiple brands need to take licences for individuals and set up several entities. So, if only there could be some change in the FDI single brand policy,” he said.
CMAI will also submit a white paper to the government, summarizing the obstacles faced by the industry, besides making recommendations on facilitating ease of doing business for retailers.
In 2022, India’s retail market was estimated at $930 billion, according to consulting firm Deloitte in its 2023 report. The market is expected to touch $1,930 billion by 2030, it added.
The association is also pitching for a retail upgradation fund to help small brands grow in across small towns and cities. “We are thinking of a fund that will help brands drive growth in smaller markets; it’s at an ideation stage. Every brand seems to have agreed that large cities are now saturated and growth is going to come from smaller markets. Most brands do not have the financial resources to fund their expansion in smaller markets. If the government could create some kind of a fund which could give capital subsidy or interest subsidy to help them expand—something along those lines, for those who want to expand to tier 2 and tier 3 cities.,” he added.
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Published: 27 Feb 2024, 11:36 PM IST