FDI in Retail & Your Views

TheDreamer

Well-Known Member
#1
The Government of India has opened the door of foreign direct investment in retail sector of India by giving the permission to invest in (51% in case of Multi-brand retail OR 100% in case of Single-brand retail) the joint venture with some Indian entities. Most of the opposition parties & some of the erstwhile allies of the ruling party have vehemently opposed the decision but the GOI is hell-bent to implement it.

Some pros & cons of this decision can be the following:

PROS:

1) A good chunk of foreign exchange will be siphoned into the Indian economy

2) Job opportunities for literate Indians

3) Better supply chain management

4) Farmers/ Manufacturers of raw materials are expected to get better price of commodities

5) Better pricing of products due to huge competition

6) Better standard of products & more customisation as per the customers' requirements

7) Fluctuation in prices of necessary commodities due to hoarding may get minimised

8) Availability of non-seasonal products due to better preservation

and many more...

CONS:

1) Loss of job of the countless middlemen

2) Unemployment of illiterate people who used to give labour in transporting of materials (as most of the works will be mechanised)

3) Cartelisation of the retail chains

4) A powerful lobby in retail sector who could alter the political scenario in India thereby gaining decisions more favourable to them

I would like to know the views of all the TJ members on this topic. I hope everyone will contribute to make it a meaningful discussion.
 

Rish

Well-Known Member
#2
Very simple, nothing is for Indians, doors are opened for only Multinational Companies and its international requirement. All infrastructure implementation in India for only pressure and requirement of Multinational / FII.

200 years back East India Company was sitting in India and ruled us.

Now, they are sitting on there own countries and ruling India.

God has to save (us) India.
 

TheDreamer

Well-Known Member
#3
Very simple, nothing is for Indians, doors are opened for only Multinational Companies and its international requirement. All infrastructure implementation in India for only pressure and requirement of Multinational / FII.

200 years back East India Company was sitting in India and ruled us.

Now, they are sitting on there own countries and ruling India.

God has to save (us) India.

Would you please elaborate your views!

FDI in retail is not a new phenomenon. Countries like China, Germany, South Africa, UAE, Brazil, Russia, Indonesia, Mexico etc has benefited from this FDI in Retail. most of the economically developed countries have organised retail & it has helped the country in many ways. so why not India!
 

Rish

Well-Known Member
#4
Would you please elaborate your views!

FDI in retail is not a new phenomenon. Countries like China, Germany, South Africa, UAE, Brazil, Russia, Indonesia, Mexico etc has benefited from this FDI in Retail. most of the economically developed countries have organised retail & it has helped the country in many ways. so why not India!
Agreed, but, other countries implemented, protecting there own people interest.

In India, our laws will never protect us instead we will protect foreigners

Examples :

Pepsi and Coca-cola - Killed our retails soft drink manufacturers. This two multinationals using Indian resource and making good profit after killed our own small industries. (Indian Govt or Law has not protected our people)

Hyundai - 75 % of the Tier One Vendors to Hyundai are Korean Companies. Slowly Indian suppliers were killed. Ultimate crime is, these korean companies will receive the materials from there parent company from Korea in higher value and it is charged on to Indian Customers on the final product. Simply Looting ! ! ! !

We can open FDI route to FII's, we should have stringent law to protect our selves.

Always, India will have fear on others countries (even maldives), though we have stuff ! ! ! !.

India is like a Circus Elephant, Does't know his power.
 
#5
2 sikh satwant & biwant singh murdered our beloved prime minister indiraji.now 2 sikh manmohan singh & montek singh with sonia gandhi & chidambaram want 2 murdered aam admi of India.all the middle class & poor people shall ruined.
 

Sunny1

Well-Known Member
#6
Agreed, but, other countries implemented, protecting there own people interest.

In India, our laws will never protect us instead we will protect foreigners

Examples :

Pepsi and Coca-cola - Killed our retails soft drink manufacturers. This two multinationals using Indian resource and making good profit after killed our own small industries. (Indian Govt or Law has not protected our people)

Hyundai - 75 % of the Tier One Vendors to Hyundai are Korean Companies. Slowly Indian suppliers were killed. Ultimate crime is, these korean companies will receive the materials from there parent company from Korea in higher value and it is charged on to Indian Customers on the final product. Simply Looting ! ! ! !

We can open FDI route to FII's, we should have stringent law to protect our selves.

Always, India will have fear on others countries (even maldives), though we have stuff ! ! ! !.

India is like a Circus Elephant, Does't know his power.
You are absolutely right .
regarding china it has own rules which boosted its mfg industry ...like fdi have to partner with local or something like that
 

Sunny1

Well-Known Member
#7
Comments in the Quote

Most of the pros are fictional spread by media .

The Government of India has opened the door of foreign direct investment in retail sector of India by giving the permission to invest in (51% in case of Multi-brand retail OR 100% in case of Single-brand retail) the joint venture with some Indian entities. Most of the opposition parties & some of the erstwhile allies of the ruling party have vehemently opposed the decision but the GOI is hell-bent to implement it.

Some pros & cons of this decision can be the following:

PROS:

1) A good chunk of foreign exchange will be siphoned into the Indian economy
how it is Pro ...only to siphoned off more money out of India

2) Job opportunities for literate Indians
how ? many people will get job and many will lose job ...net net people will lose job which is not good

3) Better supply chain management
sry dont know about this

4) Farmers/ Manufacturers of raw materials are expected to get better price of commodities
I dont think so . they are expert at loot farmers first then consumers

5) Better pricing of products due to huge competition
they are good at killing competitions . this thiers first job when entering market

6) Better standard of products & more customisation as per the customers' requirements

7) Fluctuation in prices of necessary commodities due to hoarding may get minimised
this is all different issue and more political

8) Availability of non-seasonal products due to better preservation
only if they follow the set guidelines

and many more...

CONS:

1) Loss of job of the countless middlemen

2) Unemployment of illiterate people who used to give labour in transporting of materials (as most of the works will be mechanised)

3) Cartelisation of the retail chains

4) A powerful lobby in retail sector who could alter the political scenario in India thereby gaining decisions more favourable to them

I would like to know the views of all the TJ members on this topic. I hope everyone will contribute to make it a meaningful discussion.
 

TheDreamer

Well-Known Member
#8
Comments in the Quote

Most of the pros are fictional spread by media .
Sorry dear... It was my understanding of markets & economics... 20 precious minutes' work to write the whole thing... nothing was copy-pasted... you can add to the CONS-list, if you like... :)

OMG... didn't read your comments in reply to my pointers... :p

1) No brick-and-mortar business can generate good profit in the initial years of its business, if started on a huge scale. The FDI in retail will take time to generate profit but the initial investment will be a huge boost for the Indian economy as a whole. If you go by the consolidated balance sheet of Walmart, their revenue is somewhere around USD 400 bn+ but the profit after tax is not even 10% of that.

2) The same questions were raised when computerisation happened in Indian public & private sectors. The reality is more jobs were created due to computerisation. But yes... illiterate people will lose job.

3) Just read about SCM. very simple... nothing fancy or rocket science. :)

4) Do you have any idea of what's the rate at which farmers sell their goods! It's not even 1/4th of the price at which you buy those commodities/ vegetables/ fruits.

5) In a capitalist economy, small businesses will always remain the targets of big business houses. But getting too big is sometimes injurious to health. ;) Do you know why Daimler separated from Chrysler?

6) ...

7) How can hoarding be a political issue! It's more the work of middlemen.

8) These companies will actually make the guidelines better. Recently IKEA has asked the GOI to redefine SMEs. In IKEA's view, companies working with them will become bigger than what is defined by SMEs in very short time. So IKEA would have to constantly change the sourcing companies to follow the guideline of mandatory 30% sourcing from SMEs, which may deteriorate the quality of their finished products.
 
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TheDreamer

Well-Known Member
#9
Agreed, but, other countries implemented, protecting there own people interest.

In India, our laws will never protect us instead we will protect foreigners

Examples :

Pepsi and Coca-cola - Killed our retails soft drink manufacturers. This two multinationals using Indian resource and making good profit after killed our own small industries. (Indian Govt or Law has not protected our people)

Hyundai - 75 % of the Tier One Vendors to Hyundai are Korean Companies. Slowly Indian suppliers were killed. Ultimate crime is, these korean companies will receive the materials from there parent company from Korea in higher value and it is charged on to Indian Customers on the final product. Simply Looting ! ! ! !

We can open FDI route to FII's, we should have stringent law to protect our selves.

Always, India will have fear on others countries (even maldives), though we have stuff ! ! ! !.

India is like a Circus Elephant, Does't know his power.
Name 5 retail soft drink manufacturers before Pepsi & Coca Cola came to India! :confused: In our childhood, we had only 2 choices in non-fruit soft drinks sector - Thums Up & Gold Spot. Mr. Chauhan was a shrewd businessman to understand that he couldn't compete with the 2 MNCs of huge size & scale. So sold those 2 brands to Coke & invested in mineral drinking water called Bisleri. :)

Hyundai has broken the monopoly of Maruti in India. It was Hyundai who made Maruti-Suzuki more competitive as well as more flexible in giving us choices to buy cars in small-car sector. I can still remember those boring choice of Fiats, Ambassadors, Maruti 800s & Maruti 1000s of 1980s & early 90s. :eek:

The laws are already there:

1) Minimum 30% sourcing should be done from SMEs.

2) Cities having population more than 1 million can only have these FDI retail chains.

3) States can decide whether to allow FDI in retail or not.

4) Other stipulations & clauses to grow infrastructure & the minimum quantum of foreign fund to be invested are also explicitly illustrated.
 

Rish

Well-Known Member
#10
Name 5 retail soft drink manufacturers before Pepsi & Coca Cola came to India! :confused: In our childhood, we had only 2 choices in non-fruit soft drinks sector - Thums Up & Gold Spot. Mr. Chauhan was a shrewd businessman to understand that he couldn't compete with the 2 MNCs of huge size & scale. So sold those 2 brands to Coke & invested in mineral drinking water called Bisleri. :)

Hyundai has broken the monopoly of Maruti in India. It was Hyundai who made Maruti-Suzuki more competitive as well as more flexible in giving us choices to buy cars in small-car sector. I can still remember those boring choice of Fiats, Ambassadors, Maruti 800s & Maruti 1000s of 1980s & early 90s. :eek:

The laws are already there:

1) Minimum 30% sourcing should be done from SMEs.

2) Cities having population more than 1 million can only have these FDI retail chains.

3) States can decide whether to allow FDI in retail or not.

4) Other stipulations & clauses to grow infrastructure & the minimum quantum of foreign fund to be invested are also explicitly illustrated.

You are talking about the facilities (monopoly.etc...). Facilities are different and making ourselves fools in the name of FDI is other part of story.

We always compromise / justify with some or other reason. Last 20 years, our Indian Culture has totally spoiled (forget about the facilities) and we are moving in the wrong direction missing all happiness in the Life.

(No proper organic food for Indians and what is the use of car and wal mart).

Just recall 20 years back, our life style and culture was very good, now we have only facilities no happiness.

Face of it, in India all laws are intact in the books.