Fdi in India
n International Journal of Engineering and Management Research, Vol. 2, Issue-1, Jan 2012
ISSN No.: 2250-0758
Pages: 31-36 www.ijemr.net FOREIGN DIRECT INVESTMENT IN RETAIL IN INDIA
Dr. Gaurav Bisaria
Assistant Professor, Faculty of Management & Research, INTEGRAL UNIVERSITY, Lucknow, INDIA. gaurav_or@rediffmail.com I. INTRODUCTION
FDI
Foreign direct investment (FDI) or foreign investment refers to the net inflows of investment to acquire a lasting management interest (10% or more) in an enterprise operating in an economy other than that of the investor. Foreign direct investment is the sum of equity capital, reinvestment of earnings and other long or short term capital as shown in the balance of payments. It usually involves participation in management, joint venture, transfer of technology and expertise.
There are two types of FDI: (a) Inward foreign direct investment and (b) Outward foreign direct investment. Foreign direct investment excludes investment through purchase of shares. Foreign direct investment can be used as one measure of growing economic globalization.
SINGLE BRAND
Single brand implies that foreign companies would be allowed to sell goods sold internationally under a ‘single brand’, viz., Reebok, Nokia and
Adidas. FDI in ‘Single brand’ retail implies that a retail store with foreign investment can only sell one brand. For example, if Adidas were to obtain permission to retail its flagship brand in India, those retail outlets could only sell products under the
Adidas brand and not the Reebok brand, for which separate permission is required. If granted permission, Adidas could sell products under the
Reebok brand in separate outlets.
MULTI BRAND
FDI in Multi Brand retail implies that a retail store with a foreign investment can sell multiple brands under one roof. Opening up FDI in multi-brand retail will mean that global retailers including Wal-Mart, Carrefour and Tesco can open stores offering a
ISSN No.: 2250-0758
Pages: 31-36 www.ijemr.net FOREIGN DIRECT INVESTMENT IN RETAIL IN INDIA
Dr. Gaurav Bisaria
Assistant Professor, Faculty of Management & Research, INTEGRAL UNIVERSITY, Lucknow, INDIA. gaurav_or@rediffmail.com I. INTRODUCTION
FDI
Foreign direct investment (FDI) or foreign investment refers to the net inflows of investment to acquire a lasting management interest (10% or more) in an enterprise operating in an economy other than that of the investor. Foreign direct investment is the sum of equity capital, reinvestment of earnings and other long or short term capital as shown in the balance of payments. It usually involves participation in management, joint venture, transfer of technology and expertise.
There are two types of FDI: (a) Inward foreign direct investment and (b) Outward foreign direct investment. Foreign direct investment excludes investment through purchase of shares. Foreign direct investment can be used as one measure of growing economic globalization.
SINGLE BRAND
Single brand implies that foreign companies would be allowed to sell goods sold internationally under a ‘single brand’, viz., Reebok, Nokia and
Adidas. FDI in ‘Single brand’ retail implies that a retail store with foreign investment can only sell one brand. For example, if Adidas were to obtain permission to retail its flagship brand in India, those retail outlets could only sell products under the
Adidas brand and not the Reebok brand, for which separate permission is required. If granted permission, Adidas could sell products under the
Reebok brand in separate outlets.
MULTI BRAND
FDI in Multi Brand retail implies that a retail store with a foreign investment can sell multiple brands under one roof. Opening up FDI in multi-brand retail will mean that global retailers including Wal-Mart, Carrefour and Tesco can open stores offering a
References: Tenth edition, 2007. edition, 2008. Indian Retail, 2008 FDI Consolidated Policy