India FDI in Retail to Open Soon according to Mr. Chidambaram
By Vipin Agnihotri
In my opinion, it’s a great irony that on one hand Finance minister of India P Chidambaram is pretty confident that FDI in retail is only a matter of time, while on the other the government assures that the retail sector, valuing more than $300 billion, will be opened for FDI only after the mom-pop stores are convinced that it will not pose any sort of danger to them.
But if experts are to be believed, going by the present crisis, this dream will not come true in years to come. It is worth mentioning in this regard that the protests by the small retailers have taken such a toll that they are not even sparing the Indian players.
Generally speaking, Reliance Fresh is facing the brunt of the small retailers’ assault especially in Uttar Pradesh, West Bengal and Kerala. Indications are that Mayawati’s government and Kolkata Trade Union don’t want to rely in any freshness in retailing sector as they spoil Reliance Fresh’s party in their terrain.
Taking this into account, the question now arises: What is the upshot of all this fiasco? Well, according to sources, plans of Reliance Retail starting 130 Reliance Fresh stores across Delhi, Uttar Pradesh and Uttarakhand have taken a back seat for the moment.
It has come into the notice of The India Street that the company has laid-off more than 800 workers from its workforce in Uttar Pradesh. It’s a real shocker to me that that in Uttar Pradesh only Reliance Retail is facing the agony while other identical stores such as Big Bazaar, Spencer and Subhiksha continue to cater their customers without much ado.
Now one can pretty much imagine the sort of calamities, international players will face when they open their shops in India. The pivotal factor here is that after all this redundant bureaucracy will they be really interested? The answer of this question is a bit tricky but the sheer size of the industry will lure some of them if not all.
Chidambaram’s word might also come true and all the retaliation will become a thing of the past, but it looks highly unlikely.
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