Expenditure on land cost and rentals will not be counted for the purpose of back-end infra-structure. Any additional liberalization of this market will therefore depend on the political make-up of the next government. With organized retail, every intermediate step — procurement, processing, transport and delivery — adds value to the product. Most of the organised retailers have become better than before due to the competition and their expenses have gone up especially the amount spend on advertising. Although few big local players have tried to enter this segment in order to expand their business and one such player is Reliance. However, the limit of equity participation can be increased in due course of time as we did in telecom, banking and insurance sectors. Open economies with skilled workforces and good growth prospects tend to attract larger amounts of foreign direct investment than closed, highly regulated economies.
Front-end operations would be allowed only in states that agree to authorize FDI in multi-brand retail. If you are shopaholic with a yen for Louis Vuitton bags, Ikea furniture or Cartier watches, you may soon see more swanky stores exclusively for such brands. International retailers should be mandated to bring with them technology and management know-how which will ensure that investment in organized retail works to India’s advantage. May the best model win. Foreign players should not be allowed to trade in certain sensitive products like arms and ammunition, military equipment, etc.
All you want to know about FDI in single-brand retail – The Hindu BusinessLine
The ultimate consumer will also be benefitted as they will have more options to choose from, they will be able to buy better quality and variety of products at much more reasonable price.
One of the major global players is Walmart.
Price rise due to the monopoly of foreign retailers 3. This also can result in net gains in employment at the aggregate level.
Domestic gas pricing formula. Foreign retailers therefore, have access to the Indian retail market, while India loses out on the investment.
Job creation Despite predictions from some analysts that millions of Jobs would be lost due to FDI in retail, it may in fact be the other way around. The Indian government removed the 51 percent cap on FDI into single-brand retail outlets in Decemberand indix the market fully to foreign investors by permitting percent foreign investment In this area.
FDI in multi brand retail sector of India and its Effects
In short, both unorganized and organized retail are bound not only to coexist but also achieve rapid and sustained growth in the coming years. The onus of proving compliance with these conditions could rest with the concerned retail chain.
FDI in retailing can easily assure the quality of product, better shopping experience and customer services. Valentine’s Day- What it means to you! One trip to Starbucks may equal your monthly bill at the Nair tea stall.
To ensure that the public distribution system and the Indian food security system, is not weakened, the government may reserve the right to procure a certain amount of food grains.
All you want to know about FDI in single-brand retail
In the recent past it has witnessed a large number of big players like Reliance, Tata, Pantaloon, Birla etc leaping into it. Farmers and small producers will benefit in the long run from better prices for their products and produce, while consumers receive higher quality products at lower prices, along with better service. It has also made some, albeit limited, progress In allowing multi-brand retalllng, which has so far been prohibited In India.
As a result, farmers’ price realisation remains low while the consumers in the cities end up paying a high price. Along with that wal-mart will also bring its retail expertise to India so that they can attract consumers.
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Also, by reducing the number of intermediaries, organized retailing will lead to some job displacement. Front-end operations would be allowed only in states that agree to authorize FDI in multi-brand retail. Such terms will serve as rretail safeguards for small retailers. With economic slowdown behind us, the time seems just right to expand the horizons, and realize the potential.
However, the limit of equity participation can be increased in due course of time as we multirand in telecom, banking and insurance sectors. All you wanted to know about haircuts. India is already a key sourcing country for some global retailers. There are a few strings attached, though. This will give the domestic companies their tome to establish themselves and get ready to face the competition from foreign players.