Amazon The First Foreign Retailer in Food Sector
Amazon has put his dig in to food retail sector in India. The department of Industrial Policy and Promotion has cleared the American e-commerce company’s proposal. It is forwarded to the department of Economic affairs for the final signature of the finance minister.
“From our side their proposal has been cleared. Since it is under the assent route the matter has to get a nod from finance now,” a senior DIPP official said.
The application regarding over five year investment in India about Rs. 3500 had sought approval. The Seattle –based online retailer will sell to third-party and its own private food articles, sourced and packaged locally.
In June last year India had announced 100% food direct investment in food retailer pertaining to goods manufactured locally. Making changes in the policy aimed at giving a boost to food processing industry and the farming community. The government wants s to cut the middlemen who take away earnings of the producers and often badly affect the market prices. The reason behind that is to encourage retailers to source goods directly from farmers.
Amazon is the only major overseas company has sought the government’s permission to enter the food retail business.
In its application to the DIPP, Amazon said it plans to retail “food products” across India whether it is offline or online. At present, the company offers food items through 3rd party sellers on two platforms, Amazon Now and Amazon Pantry.
In near future, company is expecting to develop infrastructure, including warehouse and distribution facilities such as a temperature-controlled supply chain, and undertake farm-to-fork retailing of food items as part of its plans in India in the food retail sector.
In addition to, the govt. is preparing credit card support to food processing sector through Rs. 2000 crore special funds created in the National Bank for Agriculture and Rural Development, and according to priority sector lending of up to Rs. 100 crore per borrower.
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