FDI in retail to lead to job loss, says Left

After urging Prime Minister Manmohan Singh not to broach the subject of foreign direct investment (FDI) in retailing during his forthcoming US visit, the Left parties are getting ready to submit a note to the government.

The note is likely to argue that opening up the retail sector will cause massive job-loss and give multinational retail chains an unfair edge over domestic players, both small and large.

The Left is likely to state in its note that by opening up retail trade to multinational firms, India will be promoting monopoly in the market, killing diversity and affecting the sustainabilty of small producers. It is likely to argue that the move will fail in India as has been the case over much of Southeast Asia.

It is also likely to say that since India does not have any prior commitment to the World Trade Organisation (WTO) to opening up the retail sector, the move is not warranted at all.

Another argument the Left parties might put up was that, since the retail sector accounted for nearly 11 per cent of India's gross domestic product (GDP), employing over 4 crore people, any effort to invite foreign capital in this sector would affect the livelihoods of innumerable people, sources said.

The Left is likely to postulate in its note that retail trade generates the bulk of the employment in non-agriculture enterprises in both urban and rural areas.