impact of fdi on retail traders
FDI in retail sector in India and its impact on retail traders
ABSTRACT:
Allowing FDI in multi brand retailing has recently generated tremendous euphoria for some and fear for others. It is based on the notion that it will open floodgates for foreign retailers to invest and will change the retail landscape forever in India. The factors that attracted investment in India are stable economic policies, availability of cheap and quality human resources, and opportunities of new unexplored markets. Besides these factors, there are a number of macroeconomic factors that are expected to affect FDI in retail in India.
This paper deals that with the introduction of FDI in retail in India, there will be an initial displacement of middlemen from the supply chain. However, the organized retailing will induce an increase in the food processing sector and these middlemen will be absorbed by it. It is also expected that the government will take innovative measures to mitigate the adverse effects on small retailers and traders involved in the supply chain. Direct accessibility to the market will be provided to the farmers and hence, a better remuneration. With respect to consumers, they will benefit from assured weights and cash memos, enhanced competition due to the presence of bigger retailers and better quality of produce.
KEY WORDS: FDI, Government of India, consumers, retail sector.
INTRODUCTION:
FDI stands for foreign direct investment i.e. investment made by the foreign companies or foreign government in India. It is mainly dealing with monetary matters. FDI is a popular mode of entering in another country’s economy. It is made by foreign countries in order to established wholly owned companies or to manage them or to purchase shares of companies in another country. It can be of two types
1) Horizontal –invest in same type of industry.
2) Vertical- financial collaboration with market unit or suppliers of input in that country. On 15th
ABSTRACT:
Allowing FDI in multi brand retailing has recently generated tremendous euphoria for some and fear for others. It is based on the notion that it will open floodgates for foreign retailers to invest and will change the retail landscape forever in India. The factors that attracted investment in India are stable economic policies, availability of cheap and quality human resources, and opportunities of new unexplored markets. Besides these factors, there are a number of macroeconomic factors that are expected to affect FDI in retail in India.
This paper deals that with the introduction of FDI in retail in India, there will be an initial displacement of middlemen from the supply chain. However, the organized retailing will induce an increase in the food processing sector and these middlemen will be absorbed by it. It is also expected that the government will take innovative measures to mitigate the adverse effects on small retailers and traders involved in the supply chain. Direct accessibility to the market will be provided to the farmers and hence, a better remuneration. With respect to consumers, they will benefit from assured weights and cash memos, enhanced competition due to the presence of bigger retailers and better quality of produce.
KEY WORDS: FDI, Government of India, consumers, retail sector.
INTRODUCTION:
FDI stands for foreign direct investment i.e. investment made by the foreign companies or foreign government in India. It is mainly dealing with monetary matters. FDI is a popular mode of entering in another country’s economy. It is made by foreign countries in order to established wholly owned companies or to manage them or to purchase shares of companies in another country. It can be of two types
1) Horizontal –invest in same type of industry.
2) Vertical- financial collaboration with market unit or suppliers of input in that country. On 15th