The Indian Government has stepped towards the growth of economy in long-run by allowing 51 per cent in FDI in multi-brand retail. The much awaited reform has been passed. Now, the global retailers are welcomed to get going with the national retailers. India is a very potential market and thus, this reform will attract many foreign investors to invest in this fruitful tree of Indian retail.
The interest of global retailers is quite obvious due to their profit and their dream of future monopoly in this competitive market. So, does not it benefit the foreign retailers more than the indigenous ones or is not it another form of neo-colonialism? The dependency of domestic retailers over domestic suppliers might lead to the decrement of progress rate upon entry of their global competitors. The foreign retailers have wide global source of goods and services and this is an edge over the domestic retailers. The foreign investment thus can diminish the local retailers and get their roots strengthened in this fertile ground. The indigenous manufacturing units might be closed and the unemployment would be increased. The global retailers, in need of less human resource but on automation, would not be able to provide the enough job opportunities.
The Indian market is in a much unorganised form. There are shops on the footpaths to the malls. The Indian market is composed of people who are fully dependent upon the small-scale retail shops. And thus, the so-called reform might make them move out of this marketing sector. Only the organised firms, which are very less in this domain, will be able to survive and get benefit. The monopoly may come and that will directly benefit the global retailers and directly costing us a lot in the future. This reform would not be able to promise employment to the already settled small scale retailers after they would be thrown out.
This is giving the glimpse of neo-colonialism, the economic colonialism of Indian market by foreign retailers. The involvement of global sector retailers in internal market of India might lead to the dominancy by them. The multinational cooperations would exploit the natural resources and the people of the Indian retail sector. It might become the same situation when the English came to India for business and then continued exploiting us in all forms for more than 200 years. The apparent business first took the shape of neo-colonialism and then ultimately transformed into the colonialism which itself is neo-colonialism in all sectors, either be politically, economically or culturally.
But today’s India is not like it was used to be 250 years before. It has now been developed. The many economic policies of India after the independence have lead to the maturity of the retail sector. The retail sector of India ought to be confident to compete with the global retailers at this stage. The policy of FDI in multi-brand retail is very well and innovatively formed and primarily focuses on the development of India’s retail sector. The #3 proposal of the policy states that 50 percent of total FDI shall be invested in back-end infrastructure which will thus improve the quality, manufacturing process, agricultural market infrastructure, storage and lot more.
Also, the expected problem of unemployment will be efficiently checked first. The policy allows the foreign retailers to set up their firms only in the cities with population more than 10 lakh. The small range influx of the foreign retailers will help government to test the consequences. Plus, the establishment of retail shops of foreign investors will be again passed through the State Checkpoint where they have to comply with their terms and conditions. Thus the well-planned structure of policy and efficient check is promising no-loss opportunities to the indigenous retailers. The wise working will surely make a progressive market for the local retailers and will abandon any issue that might be the reason for neo-colonialism. The government has come up with a very well formed policy and should be appreciated and welcomed.
This article has been published in youthkiawaaz.com.