The Delhi High Court on Wednesday asked the Union Government to take views of Confederation of All India Traders (CAIT) before framing any policy on FDI in Retail.
The CAIT has filed a writ petition in Delhi High Court seeking directions of the Court allowing petitioner to participate and represent the cause of small & medium traders with Union of India in matter of its FDI policy pertaining to retail trade.
Justice Mukta Gupta while allowing the petition of CAIT, issued a notice to the Union of India and directed to consider CAIT representation before coming to any final decision on FDI policy in retail trade. The CAIT has been given one week’s time to file representation.
Justice Mukta Gupta said, “While framing the policy, the executive is required to take views of all stakeholders to arrive at a proper decision. Since the decision of respondents affects traders, it is appropriate to take their views into consideration. Hence, the petitioners are given one week’s time to prepare a representation and presented to the Respondents and the Respondents are required to consider the same before any final decision of the matter”.
In its petition, the CAIT said that current policy of FDI in Retail permitting 51% FDI in Multi Brand Retail is creating an uneven level playing field by giving a source of abundant resources & deep finance to large retailers and MNCs and adversely affects interest of the small & medium traders and their employees as well since due to limited resources and absence of any national trade policy for retail trade and of government support, the small & medium traders are unable to compete. FDI policy is in violation of law of equality and law of prohibition of discrimination as ensured by Constitution of India.
It further said that 100% FDI is allowed in E Commerce but often in B2C business model regulations are circumvented but the Government has failed to impose any check on this. Allowing inventory based large e-retailers to procure FDI will shrink entrepreneurship skills of small traders since such MNCs will source product across the globe and dump in Indian market.
It will also greatly affect the Indian manufacturing sector. The current policy will assist the big players to monopolise and dominate the market and such dominions would decimate the local traders.
The CAIT referred to an earlier order of the Court made on May 20, 2015 in Retailers Association of India v/s Union of India Retailers Association of India seeking level playing field and parity with e commerce. In the said order, the Court directed the Union of India to consider plea of RAI.
The CAIT said that the organised retail in India constitutes merely 5% whereas rest of 95% retail trade is being conducted by small & medium traders in the country. Therefore, being the largest stakeholder in Indian retail trade, the CAIT should be taken into parleys between Govt & big retailers.
(This article was first published on channeltimes.com)