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FDI in Cash and Carry Wholesale Trade is not FDI in Retail Trade

August 2, 2018     by bsamrishindia.com

Like FDI in multi brand retail trade, FDI in Cash and Carry Wholesale Trade was also initially opposed by trade bodies saying that these stores like Metro Cash and Carry, Walmart Cash and Carry are another form of Retail Trade and FDI has always been restricted and controlled in retail trade. However, the Government was determined and ultimately the term ‘cash and carry wholesale’ was clarified as being meant for B2B sales in wholesale trade.

FDI in Cash & Carry Wholesale Trading/Wholesale Trading (WT):

Cash & Carry Wholesale trading/Wholesale trading, means sale of goods/merchandise to retailers, industrial, commercial, institutional or other professional business users or to other wholesalers and related subordinated service providers. Wholesale trading would, accordingly, imply sales for the purpose of trade, business and profession, as opposed to sales for the purpose of personal consumption. The yardstick to determine Wholesale Trading would be the type of customers and not the size and volume of sales. Wholesale trading includes B2B e-Commerce.

 

Sector/Activity % of Equity/

FDI Cap

Entry Route
Cash & Carry Wholesale Trading/Wholesale Trading (including sourcing from MSEs) 100% Automatic

 

With Cash & Carry Stores around, Retailers can keep inventory to minimum and purchase directly as and when needed as lead time of supply would be negligible and therefore such FDI in Cash & Carry Wholesale will support growth of business for local Kiryana Stores. WT of goods would be permitted among companies of the same group. However, such WT to group companies taken together should not exceed 25% of the total turnover of the wholesale venture.

For doing business of Cash & Carry Wholesale and Retail trade in the same entity, please refer to

FDI in Cash and Carry Wholesale Trade is not FDI in Retail Trade

You may also like to read about

FDI in Single Brand Product Retail Trading 

FDI in Retail Trade and E-Commerce

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