The Simple Business Man

Investments are backbone of any land and India if it has to flourish across sectors Govt has to allow Foreign Direct Investment.

Under Indian foreign exchange laws:

• 100% FDI under the automatic route (no prior approval required) for  Single-Brand Product Retail Trading
• 51% FDI under the government route, subject to conditions for Multi Brand Retail Trading

Single Brand Retail Trading (SBRT):

• Definition: Single Brand Retail Trading refers to a scenario where goods are sold under a single brand name, both domestically and internationally.

Multi-Brand Retail Trading:

• Definition: Imagine a bustling department store or a retail wonderland where you can find a smorgasbord of different brands. That’s multi-brand retail for you! It’s like a shopping adventure where you can flit from one brand to another, comparing prices, styles, and flavors.

The last significant decision regarding FDI in retail took place in 2018. On January 10, 2018, the Indian government made some amendments to the FDI policy, specifically related to single-brand retail trading. Here are the key points from that decision: Single-brand retail trading entities were allowed to set off their incremental sourcing of goods from India for global operations during the initial 5 years, beginning from the year of opening their first store.  This was against the mandatory sourcing requirement of 30% of purchases from India.

Foreign Direct Investment (FDI) has played a significant role in shaping India’s economic landscape over the past decade. While there have been various successful FDI ventures, the list below is to highlight a few notable ones that have created wealth for investors:

1. Amazon: In 2014, Amazon made a substantial investment of $2 billion into its Indian operations, followed by an additional $3 billion in 2016. Their commitment to the Indian market has contributed to their growth and shareholder value.
2. Walmart-Flipkart Deal: In 2018, Walmart acquired a majority stake in Flipkart, one of India’s leading e-commerce platforms, for a whopping $16 billion. This strategic move allowed Walmart to tap into India’s burgeoning online retail sector.
3. Google & Meta (formerly Facebook): In 2020, both Google and Meta (formerly Facebook) invested significantly in Jio Platforms, India’s largest telecom provider. Google invested $4.5 billion, while Meta poured in $5.7 billion. These investments aimed to leverage Jio’s extensive user base and digital infrastructure.

With large Indian Domestic market and still untapped there is huge opportunity for any one to invest in India.