By : Conrad Pinto ; When Prime Minister Manmohan Singh came forth with the proposal for FDI in retail sector, he knew he would face criticism of the masses, he knew that it was fuel to the opposition, he knew he was going to be criticized yet again; and in turn the graves would be dug up to defame him more. To the opposition, it was just as if the Italian Mafia was in action again and the Godfather-cum-Godmother, Sonia Gandhi was calling the shots.
A deeper study into this can give different conclusions. But well, I for that matter believe there is only one way in seeing it – The FDI in retail sector is a welcomed step into our economy.
The FDI in retail proposes that the following amendments be made to the previously held bill:
1. India will allow FDI of up to 51% in ―multi-brand sector.
2. Single brand retailers such as Apple and Ikea, can own 100% of their Indian stores, up from previous cap of 51%.
3. The retailers (both single and multi-brand) will have to source at least 30% of their goods from small and medium sized Indian suppliers.
4. All retail stores can open up their operations in population having over 1 million. Out of approximately 7935 towns and cities in India, 55 suffice such criteria.
The multi-brand sector can come as a big boost to our economy:
India is a country that has immense potential for better agricultural productivity. The current agricultural production is very much underdeveloped, compared to the given situation of agriculture, worldwide. The government is, currently, subsidizing various goods and services required for agriculture, for the farmers. But isn’t that uneconomical? Although it’s social, it is not the best thing that we can do. Multi-brand sector has a very innovative answer to this, vis-à-vis economics.
For example, let me give you a situation – Let us say that ‘A’ has made its way through and opened its store in Mumbai and it wants to sell vegetables. Now it is very obvious that importing such goods from foreign markets won’t be favorable, as buying such goods in the domestic market is cheaper than from foreign markets. So, ‘A’ finds a farmer and purchases his vegetables from the farmer ‘X’. Now ‘A’ is satisfied with the goods delivered by ‘X’, so ‘A’ establishes a better link. ‘A’ recruits drivers and purchases vehicles to transfer goods to him from ‘X’. Now ‘A’ has invested money in the drivers and vehicles, his investments are irreversible, so he may offer ‘X’ to be hired and pay him wages. (Please note that by paying him wages, X has a free will, so ‘A’ will offer him a good amount of money for ‘X’ to be satisfied. Also, the wages are regular, unlike his usual income) (In the case ‘X’ reject’s ‘A’s offer, ‘A’ may look out for, and find an alternative, but let us consider that ‘X’ has accepted ‘A’s offer) ‘X’ accepts ‘A’s offer and may either sell his land to ‘X’, or rent it – that is not our main concern. Now, in order to pump up production, ‘A’ may improve technology used in agriculture, by purchasing new tractors, better seeds, and better manure. ‘A’ is now controlling agriculture, and by this, he will seek to escalate the production. The elimination of middle men, causes a substantial increase in profits, this may lead to an increase in pay scales to all, including the farmers.
Technological development in agriculture is an obvious move with foreign investment being approved. Let us go back in time to the British Raj of the pre-independent India. India was a very backward economy then. It was good in certain elements, but not in totality. Agriculture had always served as a backbone, but never was it up to the standards of what it could’ve been. The Industrial Revolution had just started in England, and many industries were set up as a result. There was an increasing need for raw materials for their industries which were seen to be satisfied by our country, serving it up as a raw material market. As a result of that, a serious need was seen to drain this country from its resources in the least possible time, only to keep its industries satisfied with incoming raw materials. In order to do this, transportation was improved by the setting up of railways; and communication with the setting up of hundreds of post-offices all around the nation. This speeded up the process of draining out resources; but in the long-run, the railways were a big boon, and so has communication been a boon. Yes, technology was absent, but India is geographically vast, and England was a small country with a small populace. There wasn’t a need to increase supply of raw materials; and also to be noted is that technology would’ve been costly.
When it comes to the FDI in retail sectors in India, the retailers would be serving the purpose of the Indians, and not their foreign nationals. India is a country with a large population, and so is it’s consumption; hence, there will be a strong need for technological progress along with other factors, to meet demand and ultimately improve turnovers.
Honorable Dr. Manmohan Singh,
For GOD- Greatest Oblivion Delusion- sake, do not mislead the simpleton people of this country, called Bharat-Hindustan-India, because it; FDI; is just financial intrusion, by Foreign Companies, at the behest of your UPA government indeed, which is not less than treachery & is a seditious act at large.
Do not you remember that an East India Company of Britishers managed to capture the rule of this nation, because beggars have no choice at all & this shall be the condition of this said country, having 3 Three names in the days to come & the coming generation of this country shall have to pay the cost through their nose, is as certain as death.
Why your UPA government, has not been able to bring back Tons of Funds of Black Money of this nation, lying stashed in the Banks Abroad, is a very genuine question & the people of this country want to know you answer in these above contexts?
And we dare a debate & deliberations with you, in the presence of Media Magnates in this regard through The India-Post, wherein your above well versed misleading statement have come to our notice—dr.amritgaur