FDI in retail in India has been opened up and it has caused a whole lot of controversy in the country. Parliament is not able to work and opposition is pushing government for a roll back. FDI basically stands for foreign direct investment. India had signed agreement of trade in services by world trade organization so it was expected to happen here.
FDI in retail in India has been opened in a systemic manner. As per the existing rule, a foreign firm can’t have majority shareholding in a retail firm. FDI in wholesale was initially opened under government approval rule in 1997 and later it was bought under automatic route in 2006. As per the new rule, foreign companies will have permission to work in retail sector in India and hold majority share in the company.
FDI in retail in India has been discussed in past also but as it is approved now by the government, issue is on the floor. Traders have also opposed it. Foreign direct investment in India will have its own ups and downs. So it is not going to be easy for global retail players to handle and manage Indian supply chain and distribution channel which is still largely unorganized in the farming sector.
FDI in retail in India have its own pros and cons but it is definitely going to help in employment generation and farmers because they will be directly interacting with these chains therefore getting better rates than what they get while dealing with a traditional commission agent who act as intermediary between him and buyer.
FDI is also imperative to check adulteration and malpractices in the retail sector. Food adulteration and malpractices are severe problem in the retail sector where small retailers indulge in such activity. In case of big retail chain, brand is very important and providing goods of high quality is of utmost importance for them so expecting an improvement in the quality of goods sold at these stores should be considered as fair.
FDI will also help economy which has slowed down significantly this year because global players will infuse money in the Indian market. It will also help local players at the rural, suburban & small cities level because these global giants will need people at that level to complete their supply and distribution channel. So it will also help the local entrepreneurs. They will also need people to work in field and their stores, so that will help in generating employment. So it is yet to be seen but expecting good out of FDI in retail India seems to be logical and rationale.
FDI in retail in India will have its own course but short term fluctuations will keep them on their toes.
About akhilendra
विदेशि निवेश से अ्च्हा होगा,रोज्गार मिलेगा और चीजे भी सही मीलेगी.