FDI in Retail in India is a Boon or Bane?
Last Updated: Sep 21, 2013
FDI in retail industry means that foreign companies in certain categories can sell products through their own retail shop in the country. At present, foreign direct investment (FDI) in pure retailing is not permitted under Indian law. Government of India has allowed FDI in retail of specific brand of products. As India is one of the developing countries, so FDI must be promoted but must be kept under control as it can affect the economy of the country.
FDI in INDIA
FDI in my opinion is bad for the country’s economy. As we are in the category of developing country and to develop properly we need to control the country’s economy very carefully. If the % in FDI in retail sector (multi-brand) is increased then the investment in India’s retail market will be from foreign investors and the profits are also drained to the investors. And moreover in INDIA, the retail sector mainly depends upon the agricultural sectors and the producer and if FDI is increased then it is going to affect the agricultural sector of the Country very badly and which will affect the country’s economy. And if the % of FDI is increased to 100% in retail (both single and multi-brand) sector then government will lose the control over this sector completely and then it cannot help in controlling this sector with its rule and regulations as the whole retail sector would be privatized. And this privatization can make a very serious effect on the country’s economy.
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And one of the most disadvantage of FDI in retail sector is that as we know that the retail sector is one of the major employment provider and permitting FDI in this sector can displace the unorganized sector and leading to loss of livelihood the most favoring example is if wall mart entry in retail sector is allowed then it will kill the millions of local shops and jobs. The global retailers would exercise monopolistic power to raise prices and monopolistic power to reduce the prices received by the supplier. Hence both the consumer and supplier would lose while the profit margin in such retail change would go up. So from the above points i can say that FDI in retail sector is not good for India.
Advantages of FDI in Retail in India
- Growth in Economy
- Job Opportunities
- Benefits to Farmers
- Benefits to consumers
- Lack of Infrastructure
- Cheaper Production facilities
- Availability of new technology
- Long term cash liquidity
- Conducive for the country’s economic growth
- FDI opens up a new avenue for Franchising
Disadvantages of FDI in Retail in India
- Impact on Local Markets ( Kirana Shops)
- Limited Employment Generation
- Fear of Lowering Prices
- Negative Impact on Indian Economy
- Negative Impact on Indian Domestic Market
Please give your views in the comment section below. Any type of suggestion will be appreciated.
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142 Responses to FDI in Retail in India is a Boon or Bane?
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according to my point FDI is the best for the rich man because they are [partership with the forigen investres and get a more profit but middle class and lower class people are not do the our businness
so our economy condition will goes down.so FDI is not helpful our country.
Hello.. ofcouse it will be bane how can it will be boon..
if it will be bone then tha economy rate will be decress, we are also a grothing INDIAN, we are not develop indian. we need to a big industry and god economy rate for growthin indian.
FDI in my opinion is bad for the country’s economy,moreover in INDIA, the retail sector mainly depends upon the agricultural sectors and the producer and if FDI is increased then it is going to affect the agricultural sector of the Country very badly and which will affect the country’s economy.this privatisation can make a very serious effect on the country’s economy. And one of the most disadvantage of FDI in retail sector is that as we know that the retail sector is one of the major employment provider and permitting FDI in this sector can displace the unorganised sector and leading to loss of livelihood the most favouring example is if wall mart entry in retail sector is allowed then it will kill the millions of local shops and jobs.
Fdi is a foreign direct investment.it is a terminology which has been making for foreign countries by which they can direct invest their products in our country and they can sell their product in retail price.fdi is beneficial for our country because through this farmers can gain more profit on their products and if they will gain more profit from their farming then it is also provide them a good farming method and farming in a large quantity..and so it will be beneficial for us in a way that we can buy our necessary food and other products in minimum cost and so our economy will also be maintained.
Foreign Direct investment in retail basically mean ‘ allow foreign companies to do direct business in India’. Till now this is banned in India. There are two terms related to a country i.e developed or developing. We are still in developing stage. Today ‘we have more hands but less work to do’ so FDI in retail is ofcourse a boon for our country as per current situation. This will produce more jobs in India and give more chance of employment which is one of the our basic need today, but FDI should be applicable with some conditions like it should be applied for five year first in some specific sectors and after five year if we still need this then duration can be increased, so that this would not harm our economy and our own business is enhanced.
Foreign Direct investment in retail basically mean ‘ allow foreign companies to do direct business in India’. Till now this is banned in India. There are two terms related to a country i.e developed or developing. We are still in developing stage. Today ‘we have more hands but less work to do’ so FDI in retail is ofcourse3 a boon for our country as per current situation. This will produce more jobs in India and give more chance of employment which is one of the our basic need today, but FDI should be applicable with some conditions like it should be applied for five year first in some specific sectors and after five year if we still need this then duration can be increased, so that this would not harm our economy and our own business is enhanced.
FDI is a boon if it is allowed under certain limits, after that limits it will lead to decrease economy of our country and turn out to be a bane. Foreign countries sell there product directly here, which transfers our money to there country. Local business get affected due to FDI, which turn out to be a major problem for the suppliers and dealers of our country. So FDI should be under control of government, increasing it to 100% would take it completely out of the control.
Foreign direct investment can take on many forms and so sometimes the term is used to refer to different kinds of investment activity. Commonly foreign direct investment includes “mergers and acquisitions, building new facilities, reinvesting profits earned from overseas operations and intracompany loans. However, foreign direct investment is often used to refer to just building new facilities or greenfield investment, creating figures that although both labeled FDI, can’t be side by side compared.
I think fdi in retail is a bane for indian point of view because this will hide the indian technologies,if we use fdi then we wasted our country income in tax and what the result is selling them in big prices.All the country have the ability to fulfill all the user demand.So fdi in retail is not a proper option but if the country make a profit on that then they should me select that path.The case is not that fdi is a boon or a bane,but the condition is that,Is the country make a profit or not,but our country make a profit on that then the opposition country is also make a profit,i.e.why they have done the partnership.
I am in support of this post. FDI is not a solution to ijncrease the GDP rate of INDIA. Every one knows that the current GDP rate of INDIA is 5.5% and all our country depends upon agriculture…
If the FDI is come in INDIA that time the all profit would be taken by the foreign investers and indian people get poor and poor and the India’s percentage of BPL also increases due to poorness. When FDI is come in INDIA that time all the small shops are get close.
FDI increases the poorness in INDIA……
At some extent there is a need of the FDI in the Indian market because this will help the Indian economy and the globalization but if it is allowed for the 100% investment than our economy would be devastated. The FDI will be beneficial to the farmers who can direct sell their produced goods to these markets instead of other people. To be a developed country there is a need of such foreign investment in the country. But extent of it may be harmful. Giving full control to these type of investment will cause a harm to the new markets in the country.
FDI is boon because it provide more oppotunities in India.FDI provides more jobs in India. More jobs means less unemployment. Less unemployment means moving fast towards developed country.India is developing country so FDI must be promoted. But anything in excess is bad so it must be promoted in limit.
fdi is good for country but its also fed effects to the nation economey .as we are in developing country and to maintian our development its neccesary that maintain our economey………………….
we can not say its good for our country ………..custmer is king today they know very well our good or bad .and we see last 8years the well market are in down stage or loss in business .so i think the retail is not good for our nation .theory of pretupation influience is day by day we know then its bad for our nation
fdi in retail is a boon in our country in my opinion because it takes the lot of jobs with us and we get many oppurtunities in that..many job offers are rolling back and give the chances to our peoples which might became a beneficial for our country..by introducing such marts in our country we can definitely raise our economic part too..because when these products are being sold in the country then we get the profit by the revenue system and this will result in the deduction of the cost prices of many things if posible..so the fdi in nretail sector will be a boon in our country as soon as will get setup in the country..
We can promote FDI to some extent and keeping it under control because it will bring some jobs india upto some mark. It will affect our agricultural sector so we should control it. So,there is a diplomatic view in this FDI case,because they will create more jobs we can afford FDI upto some extent but not completely,as producer and agricultural sector will be affected hard and india is mainly dependent on them.Further,indian farmers or those who are illitrarte would not be able to complete his need of food and shelter.
So keeping in mind both the things FDI should be introduced upto some extent.
at an angle fdi in retail is good for india but the condition is that it should be in coltrol. by giving the chance to foreign investers the profit of medium level industries will decrease but the cost of the things for a normal person will also become cheaper. this is the problem for industries who are working at the medium level. so fdi should be allowed but only in certain things and only at a defined level. so the industries of the developing india and the normal people of india both will be in profit. Another thing to be remember that the cost of everything is increasing at a very high level so by allowing wallmart and such kind of investers we can make the cost moderate.
FDI should not enter in INDIA. we know, about 250 years ago england also came for business but what they did. They have taken all from india like money, unity etc.
But now i know FDI not means to take the seat again. They will create unemployement in india because they refer people from their country and also machinery. As well as they also make the things cheaper so the value of indian item will decrease.
The farmers of india will also be affected. They came with such products which are cheaper in their countries.
FDI affects unity, we all know in parliament some parties are with FDI and others are against it.
FDI is bane.
I CANT UNDERSTAND WHY SO NOISE IS CREATING ON FOREIGN DIRECT INVESTMENT(FDI).AT MY SIDE IT IS GOOD FOR CONSUMERS I CAN PROVE BY FOLLOWING STATEMENTS-
1.INDIA IS THE 2ND LARGEST COUNTRY IN THE PRODUCTION OF FRUITS BUT DUE TO LESS STORING CAPACITY MORE THEN 50% GO TO WASTE .
FDI WILL PROVIDE THIS SO IT WILL REDUCES THE PRIZES AUTOMATICALLY.
2.THE SECOND THING IS FROM THE SIDE OF SELLERS ,IS THE HALDIRAM OR BIKANO IS CLOSE AFTER THE ENTRTY OF MCDONALDS?
i think fdi is bane in the country like india.because there are several peoples who have the small shops and their whole family is depending upon them.and indian democracy gives the complete freedom to all peoples.if the fdi is come in india then the small retailers,shopkeepers and small merchant they all lose their way of living because fdi gives all items on very low price and indian government should understand about all those peoples which are dependent on their small shops and their whole family are dependent upon them.
FDI is surely a boom for country productivity as it help farmer also as due to it folllowing will increases -competition increases ,product quality increases,customer had wide variety of choises, and government can collect a great revenue from forgein investor.
fdi is good for county but its also fed effects to the nation economy.As we are in developing country and to maintain our development its necessary that maintain our economy.
FDI ,let see it is good or bad for us(indian people),time tell us 🙂
FDI in Retail is a Boon or Bane?
FDI in retail industry might be a boon or bane. I can surely say it in two words: “ It depends”. Speaking about Wal-Mart, the company is in loss from last 8 years. I don’t feel that entry of Wal-Mart will kill all the market present today because of various reasons such as:
Nowadays, customer is king and is aware of what is right and what is wrong for them. However, consumer behaviour can vary from region to region. Theories of perception can influence the decision-making capabilities of any customer. In short, country’s economy is definitely going to affect by introducing FDI in retail sector. This change will add colours to the economy or not is the big question here. Any change can create chaos for sometime in an existing system. However, I completely agree with the author’s point that global retailers will use monopolistic power and will play with the pricing of different products they offer.
In my opinion FDI in retail has somewhat good aspects but as we know every coin has two faces therefore it also have bad aspects as well. good aspects are:
-Foreign investors will bring their produts to upgrade the retial sector acroos the country.
-FDI in retail also bring down the food prices which is the
major cause of inflation.
-one more important aspect of fdi in retail is that farmers would sell their produce directly to the investors and they also get better prices for thier produce.
-it also generate employement oppurtunities.
Bad aspects:
-FDI in retail has very bad impact on small shopkeeper as foreign investors work on small margins.
FDI IN RETAIL IS JUST LIKE SCIENCE WHICH GOOD AND BAD BOTH, BECAUSE WHEN FDI COMES IN INDIA THEN IT BROUGHT DIRECTLY FROM THE FARMER AND SELL IN MARKET. SO THIS THING IS GOOD, BUT PROBLEM IS THAT WHEN THE QUALITY OF FARMER COMPONENT IS SO GOOD THEN THE PRICE OF THE VEGETABLE, RICE , WHEAT Etc. IS DECREASE. QUALITY MEANS SHAPE AND SIZE OF VEGETABLE SUCH LIKE TOMATO, POTATO, NOT IN EQUAL SHAPE AND GOOD/PROPER SIZE WHICH IS DANGEROUS FOR FARMER. SO FDI IS NOT GOOD 100% THERE IS DEMERITS ALSO.
In my opinion the FDI is really a bane for our country because after this the local business of india market going down. the mahatma gandhi also said that if we want to improov the value of indian currency we should use all the india made items,and after the fdi the foreign countries direct invest in indian market and the price of branded foreign items going low that effect on indian market and most of the person start the use of foreign brands.
so, according to me the fdi is not a proper solution for the problem of recesion. Thank you