FDI irritants may go; but no change in retail for now: Nath

New Delhi, May 18:The new UPA Government will be ready to remove procedural bottlenecks for foreign investors but allowing FDI in multi-brand retail will not be on the immediate agenda, Commerce and Industry Minister Kamal Nath said today.
"We are going to see if there are any irritants in the way ... We have got to make India a very attractive destination for investment," Nath said in an interview with CNBC-TV 18.

He said FDI inflow to India has "not dried up ... But (getting it) has become competitive".

FDI inflows dropped in February to USD 1.4 billion, almost one-fourth of the inflows witnessed in the same period a year ago, under the impact of the global credit crunch. In February 2008, foreign investment was USD 5.67 billion.

When asked whether FDI could finally be allowed in the multi-brand retail sector, Nath said, "Not for the time being ... We have done some studies, which need much more work." Independent think-tank ICRIER had conducted a government-sponsored study on the impact of FDI in retail on neighbourhood kirana shops last year. It had said that the big stores as also mom-and-pop shops can co-exist.

Reviving FDI inflows will be a key challenge for the new government. Changes in FDI policy, announced in February, have created a lot of confusion among both domestic and foreign investors. PTI