FDI in retail is the best opportunity of reviving Indian Economy Slokham dreamt 7 gave us Bhakra Nangal,
Right Brothers dreamt & gave us aero plane
I too dream, yes I dream to live in a fully developed India
Seeing it emerge as an economic superpower,
Viewed by the world as the land of prosperity & plenty.
My dear listeners the boon, the blessings of FDI will make my dreams a reality. Good morning ladies & gentlemen I stand before you to speak for the motion “FDI in retail is the best opportunity of reviving Indian Economy” FDI- understanding the term from layman’s perspective means investments made by a foreign company in the domestic market to acquire management control, profit sharing & ownership in accredited company. Here FDI is not only inflow of monetary investment but technology, expertise, knowledge, joint ventures etc. FDI in retail will open opportunities for India by focusing on various aspects 1. Agriculture
FDI will lend a helping hand to uplift our hard struggling farmers & ensuring sustainability. Contract farming wil ensure proper sale. Sharad pawar the agriculture minister wrote a letter to PM thanking him for the move and saying it will increase the output & reduce Wastage.
According to McKinsey- 40% of fruits & vegetables in India get rot because of no storage facility. India wastes around 50000 crore in food chain itself. Had FDI been introduced earlier our crops wouldn’t have been sold to Pakistan at a loss of 1.3 million but its better late than sorry. For any foreign investing in India under FDI retail it is compulsory that half the amount to backend infrastructure has to be invested for cold storage & supply chain. 2. Cost benefit
You might have noticed in the pamphlets of retail stores likes Metro, easy day etc telling the difference between market price & their price. Along with the benefit of good quality. These quantity discounts actually make prices competent for common man. 3. Right enforcement of tax laws
There is a lot of apprehension regarding the profit distribution structure. Let me bring to notice that these retail giants unlike many general stores work on billing transactions thus they have likewise no chances of concealing income. And thus paying apt amount to the exchequer. According to a report by Ernst & Brent with the coming of FDI by 2018 tax revenue generated would be 25-30 billion dollars. Thus benefiting nation at macro level.
Each year India produces 10 million unemployed youth. as per Montek Singh Ahluwlia, FDI in retail provides employment in 2 fields- physical sale & purchase and supply chain management. so it’s a 2 way benefit.
Wal-Mart sourced goods worth 125million dollar from Punjab alone. So lets leave our myopic vision & concentrate on the benefits to masses at large. Under FDI retail act it becomes compulsory for foreign investors to do sourcing of 30% from medium & small scale industries.
Resistance to change is a common psychological phenomena. Before 1991 LPG people were against it but it resulted in modernization & economic upliftment. So, it wouldn’t be wrong to say that opposition at centre & my worthy opponents here through there arguments are leading to delay of decision worth taking. According to the Hindu our present GDP is 5.5% but with the introduction of FDI we can reach the desired 8-9%, our retail sector is around 15% whereas it would double & be 30% by the end of 2014 if FDI in put in practice with resilience. My fellow opponents have been stressing too much that the small retailers wil be badly hurt! But Kamal Nath union Minister at press release clarified all the doubts by saying “ I think small & medium retail can live with large retail. I don’t see people abandoning their local shops 2 drive 15-20 miles to a large retail outlet unless he is getting some real benefit out of it” Strong legal structure through Competition Act provides protection to small retailers so that predatory pricing is not done by big stores. For the opposition real issue is not FDI but about big v/s small. We have said FDI is allowed only in cities with over I million population. How many cities will qualify? Only 21 cities in all states. Lets revive our economy by opening our window & letting the rays of light in the form of resource utilization, employment, professional ambience enter eradicating the darkness of paucity of funds, unemployment & slow economic growth.