Opening of FDI in multi brand retail has evoked mixed reactions from the region.
The Union government has cleared 51 per cent foreign investment in multi-brand retail and 100 per cent in single-brand retail, thus opening the country’s estimated Rs 30 lakh crore retail market to global super market joints.
While the CII has favoured the decision and maintained it would benefit farmers and consumers, CICU has opposed the decision terming it as death knell for the small traders.
The Northern region members of Confederation of Indian Industry (CII) have expressed hope that FDI in retail will greatly boost organised retail in India and drive inclusive growth, especially the SME’s , farmers and consumers as it will offer wider choice with better quality to consumers and bring in more business opportunities for SMEs
RM Khanna , Past Chairman, CII , Northern Region said they support the introduction of FDI in multi-brand Retail recognising that it would benefit the consumers, producers (farmers) and small and medium enterprises (SMEs) besides generate significant employment. This would open up enormous opportunities in the region for expansion of organised Retail and allow substantial investment in backend infrastructure like cold chains, warehousing and logistics.
Pikender Pal Singh, Regional Director, CII Northern Region said the biggest beneficiary of FDI in retail would be small farmers, who will be able to improve productivity and realise higher remuneration by selling directly to large organised players and thereby shorten the chain from farm to consumers. With larger investments that are now expected in Retail, procurement and storage of products particularly farm products will improve. Bulk procurement will increase. Product traceability, anti counterfeiting measures is likely to improve.
However regional industrial organisation CICU (Chamber of Industrial and Commercial Undertaking) has opposed the term.
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Avtar Singh, General Secretary, CICU said the move will help just the promoters of bigger retail chains.
“This will create major problems for the country, lead to further unemployment, cause inflation and price rise. Entry of global retail joint would force small traders to shut shops throwing million of people out of jobs as they will be unable to compete with foreign joint. Small traders will be most impacted and will have to face much pain and great hardship.” Singh added while the provision of 30 per cent more buying from SMEs, is made , however there is no well defined mechanism to check that 30 per cent is to be bought from small sector.
He demanded government should find innovative solutions to nourish small traders, small scale, tiny and village industry for their growth and survival. This will bring maximum employment with minimum investment and also help in growth and development of semi-urban and villages which is the need of the hour.