PRESENTATION ON: FDI in Retail PRESENTED TO: B.K.BAL SIR PALLAVI MAM PRESENTED BY: RAJAN SINGH SAQUIB SALIM SANATAN SASANY SABYASACHI CHAND
PRESENTATION ON:
FDI in Retail
PRESENTED TO:
B.K.BAL SIRPALLAVI MAM
PRESENTED BY:
RAJAN SINGHSAQUIB SALIMSANATAN SASANYSABYASACHI CHAND
About FDIForeign direct investment (FDI) is direct
investment by a company in production located in another country either by buying a company in the country or by expanding operations of an existing business in the country.
RETAIL TRADE : BACKBONE OF ECONOMY
Retail trade is world’s oldest business.
Retail trade consists of sale of goods & services to consumers for their personal, family or household use.
Based on turnover and volume, retail trade is worlds biggest economic activity.
In India by investing nominal Capital a person can start retail business.
In India Retail shops are generally owned and run by family. The whole family gets self employed.
Trader done
Traders give employment to that neglected section of society who do not get employment any where.
Traders take care of entire family of his employees. During famine, floods, earthquakes tsunami and other
natural calamities, the traders have always come out openly to extend full help to Govt.
In all social activities & establishment of schools, colleges, hospitals mandir, masjid etc. traders have contributed.
Indian traders have always seen customer satisfaction above personal profit.
LICENCES & PERMITSINDUSTRIAL DISPUTE ACTSHOP & ESTABLISHMENT ACTCOSUMER PROTECTION ACTWEIGHT & MEASUREMENT ACTPACKAGING ACTPREVENTION OF FOOD ADULTRATION ACT
PREVENTION OF BLOCK MARKETING ACTANTI HOARDING & PROFEELING ACTMONEY LENDING ACTPRODEND FUND ACTMINIMUM WAGES ACTESI ACTGRATUITY ACTBONUS ACT
INEFFICIENT LABOURS
PRESENT CONDITION OF TRADERS
INSPECTOR RAJ
POLITICIAL INTERFERANCE
ANTI SOCAL ELEMENTS
WATER TAX
POWER PROBLEM
HIGH BANK CHARGES
SALES TAX
OCTROI
SERVICE TAX
WELTH TAX
PROFESSIONAL TAX
INCOME TAX
ENTRY TAX
VAT
STAMP DUTY
POOR MARKET CONDITION
PURCHASE TAX
ESSENTIAL COMMODITIES ACT
CENTRALEXCISE
FDI in Retail Trade
Fringe Benefit Tax
New Naka Complex
Cash Transaction Tax&
Quarterly ‘C’ Form
IT WAS THE CRITERIA FOR FDI
Finance Minister and Prime Minister Dr. Manmohan Singhji referred to certain criteria for allowing Foreign Direct Investment. These were:
i. Establishment of basic industries require huge capital and advanced sophisticated technology.
ii. Infrastructure projects like electricity generation, road ,building etc.
iii. Projects which would generate employment.
What will HAPPEN WITH FDI IN RETAIL TRADE
Throughout the world it is known fact that huge investment is not required to open a retail shop.
Investment is required to build infrastructure for shop, sophisticated technology is not required in retail trade.
Small Retail shops provide more employment then large chain of Retail stores.
There is no gestation period. Hence business starts from day one.
Instead of developing under developed areas these stores capture prime commercial property in cities.
ALL WORKS IN FARM WILL BE DONE BY MACHINE UNDER CORPORATE FARMING
AUTOMATIC TRANSFER AND PACKING BY MACHINES.
SALE TO CUSTOMERS THROUGH CHAIN OF DEPARTMENTAL STORES.
LARGE NUMBER OF SELF EMPLOYED TO BECOME UNEMPLOYED.
AFTER M.N.C. /FDI TAKE OVER
WHAT WILL HAPPEN TO LOCAL RETAIL TRADE
No of Retail outlets Between 1981-99 in United Kingdom came down from 56862 to 25800.
Between 1970-80 in Europe about 4 lakhs Retail shops were closed.
Competition shall be limited to Big Retail Houses
In the year 2000 Five Big Fast food companies captured following percent market share :
WHAT HAPPENED IN OTHER ASIAN COUNTRIES
Other countries are also unhappy. Many countries have started taking precautions.
Indonesia and Malaysia have established zones within which these foreigners can do trade.
In Japan Big companies have to discuss with small traders. There is Zoning system also.
There is wide discontent amongst shopkeepers & people in the countries to which these store belong.
The city counselor of California & Chicago have refused to allow opening of new shops to WALMART.
NOW ITS TURN OF INDIA
The tough stand taken till recently by Central Govt., Foreign Retail Traders could not enter India.
It is unfortunate that Central Cabinet has given approval to FDI in Retail Trade.
Shift of Major retail trade to these big companies will render small traders & their employees unemployed.
Many companies with the help of contract farming will sell goods produced in farms directly from their chain of stores.
These companies will keep only graduates and above in their employment. There will be no scope for employment to under graduate and others.
CONTRACT FARMING
COLLECTION OF AGRICALTURE PRODUCTS
TO OWN FACTORY
TO OWN DEPT. STORE
TO CUSTOMER
REQUEST TO STOP FDI IN RETAIL TRADE
If Domestic Retail Trade is allowed by Big MNC’s etc., there will be Large Scale Unemployment.
A new class of unemployed called “Unemployed Traders” will join the existing force of unemployed persons.
These companies will sell internationally procured products. Domestic Industry will suffer.
Everybody knows how Big Fish eats away small fishes.
Keeping the experience of other countries in mind, Govt. should not take any such decision for which the whole country and coming generation will have to suffer.
SELF EMPLOYMENT IN INDIA
India has huge force of unemployed persons.
Govt. has failed to generate need based employment..
Majority of people in India are self employed.
The Major area of self employment is Agriculture and
Retail Trade .
The farmers problems were not addressed timely. They
are committing suicide.
WHAT SHOULD GOVT. DO
Govt. should identify the weakness of present retail trade.
Govt. should specify the areas where customers are not being served properly.
Govt. should specify what it expects from retail trade that is not being met presently.
Govt. should publicize the sector / persons who have demanded FDI in Retail Trade.
Govt. should come out with white paper on FDI in Retail Trade specifying the picture after 25 years and 50 years.
INDIA : MY COUNTRY
Don’t see India as population of one hundred forty-five
crore mouths to feed.
See it as a market of one hundred forty-five crore
consumers with,
Two hundred ninety crore eyes to watch your products
and,
Two hundred ninety crores hands to buy your products.
Worlds largest emerging retail market : who will
conquer it :?..................... we ………………
THANK YOU