India-US Bilateral Deal May Trump Retail Trade Policy

The retail policy was meant to address structural challenges faced by small businesses

- Dhirendra Kumar

The Union government is likely to put the proposed National Retail Trade Policy on the back burner, a move seen as a conciliatory gesture towards Washington as negotiations for the India-US bilateral trade agreement enter the final stretch.

The retail policy, which was first proposed in 2019, was meant to address structural challenges faced by brick-and-mortar traders and small businesses due to rising digitization and platform-driven commerce.

Shelving the policy may indirectly benefit US-based retail giants—particularly e-commerce firms like Walmart Inc.—by allowing them to continue operating in India without additional regulatory oversight.

Domestic retail chains such as DMart, owned by Avenue Supermart Ltd, Reliance Retail Ltd and Tata Retail Ltd would also benefit from the policy shift.

With India's e-commerce policy, originally due in 2023, pushed to the sidelines, government officials said a separate retail policy is no longer necessary.