European ...keep can tax....outside carries.....
America can kill BPO .....
BUt if ...India stops FDI....they are disappointed...and start bashing India...
could you explain why airline industry is sagging.....
why they would sell tickets for loss....
I think lot of corruption is involved there by profits are being transferred somewhere and in ...balance sheet ....start going bad...
As per my view, the airlines is not that profitable business. Especially with vagaries in demand for air travel, oil price fluctuations, regulations and stringent maintenance rules.
Airlines vie with one another for market share and people want to spend more or less same money on air travel. Thus, airline industry has got into the practice of participating in oil futures markets to hedge their fuel bill. The extent of success with this is not known.
If you happen to see Kingfisher, it has not made profit from 16 quarters and I expect them to be in loss in the next quarter as well but the stock is holding up as some speculators/investors believe it might be bailed out or in long term will return to profit.
FDI is important for MNC's because they see a market with 1.2 billion people and revenue growth at least in the medium term is assured. Developed economies have maxed out on debt (consumer and government) and if the retailers have to show growth, one area that they could focus would be on emerging markets with high population.
This has a problem that the earnings from India will be siphoned out (at least majorly) and converted to dollars or Euro (if it survives) or GBP. This will invariably lead to weaker rupee in the long term. A weaker rupee will ensure high cost of products imported (including the ones offered by retailers) and high inflation.
Our IT sector is largely because of low cost. The argument in the developed countries it can not be a one way bet. If they are allowing outsourcing , we should allow things like FDI. That is in short, mutually beneficial relationship (of course for corporations only)
Shepherd
