Amazon wants to invest $500 million in retailing food products in India. And it looks like it might get its approval very soon, according to PTI report.
The proposal was initially pending before the Foreign Investment Promotion Board (FIPB) board. But with the FIPB being abolished, the Department of Industrial Policy and Promotion (DIPP) is looking at it and an official has told ET that it will soon give a green signal to Amazonâ€™s investment plan.
The DIPP under the commerce and industry ministry had earlier cleared the investment and sent the proposal to FIPB for the final nod.
"With the abolition of Foreign Investment Promotion Board, the DIPP would soon announce the approval of this proposal," a senior official in the commerce and industry ministry told ET.
ET reports that the government had received investment proposals from three companies - Amazon, Grofers and Big Basket - worth $695 million for retail of food products.
While Grofers and Big Basket are homegrown online grocery players, Amazonâ€™s Indian arm is one of the largest ecommerce companies in the country.
Last year, the governmen allowed 100% foreign direct investment (FDI) through approval route for trading, including through e-commerce, for food products manufactured and produced in India.
Post this, the food processing sector between April 2016 and December 2016 received FDI of $663.23 million.
Food Minister has earlier said that FDI inflows will help bring new technologies, products, processes and market into the country, reports ET.
Foreign investments in backward and farm-gate infrastructure in the supply chain would benefit farmers and processors, and create employment, she added.
It was announced in the Union Budget 2017 that the government would be winding up the 25-year old FIPB, which has been vetting FDI proposals that required government approval. The idea behind its abolition was expediting the clearance project.
Under the new mechanism, the proposals will now be approved by the ministries concerned as per the standard operating procedure approved by the Union Cabinet.
Image: Kyle Brazil