Special Correspondent

NEW DELHI: Confusion and divisions within the United Progressive Alliance Government on the entry of Foreign Directive Investment in retail sector have surfaced once again.

The Prime Minister's Office is reported to have pulled up the Department of Industrial Policy and Promotion for not responding to Congress President Sonia Gandhi's concerns.

Bharti Group chairman Sunil Mittal said that their partnership with Wal-Mart remained unchanged.

A PMO communication said the Prime Minister has desired that the Department of Industrial Policy and Promotion may conduct a study of the possible impact of transnational supermarkets and major domestic business houses on small-scale retailers and vendors.

"The Department may commission a reputed research or academic institution for this purpose," it said, adding the timeframe for completing the study should be reasonable.

Concern

Dr. Singh's concerns came days before the visit of Wal-Mart officials to India for discussing their venture with Bharti group. The PMO's missive says: "Prime Minister has observed that the President AICC had raised a specific issue in her letter."

Ms. Gandhi had referred to the need for a "careful study" of the likely impact of the entry into retail trade of transnational supermarkets on the livelihood of small-scale retailers and vendors.

"The department of IPP has not responded to this issue in their comments [sent to PMO on February 7, 2007]," the PMO letter said.

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