A majority of constituents of Retail sector in the un-organized sector regularly defaults in payment of sales tax, income tax. It pilfers power and encroaches on public land .It is, however, smart enough to pay bribes to corrupt politicians, the Police, Sales tax, income tax, municipal officials and those working in Bijli and Jal boards. The leakage of public money contributes to growth of black money, not GDP.Once the FDI becomes operational, in multi-brand retail sector, the circulation of black money could reduce marginally. The moot point is : Could the kirana store owners work out an effective response mechanism to retain their market share in the consumers’ shopping basket under the revised dispensation? Yes; but not without consumers’ support. The Kirana shops in villages, towns and cities are located in the neighbourhoods. Their replacement by multi-brand retail outlets would be out of question. These will continue to receive patronage by consumers due to their residential proximity combined with high transport cost, traffic congestions, parking problems around Big bazaars, Malls etc. These act as a damper on consumer enthusiasm for visiting the Malls.
The Congress is aware of ground realities.However,beleagured by public angst against serial scams, rising inflation , the party was in desperate hurry in notifying FDI rules by skipping promised consultation with political parties and without taking Parliamentary approval. The motive was loud and clear : To deflect public attention from the latest Coalgate scam allegedly involving the PM , his aides and central Ministers. The fear that “foreign players will capitalise on India's high-cost manufacturing base” may not hold water in the face of experience gathered by India’s majors like the Reliance. Big Bazaar etc.The backlash by Kirana owners and their salesmen against indian majors, is not forgotten.
The assumption that FDI will boost india’s economic independence ,is thus fallacious ,simplistic and misleading. It will be a no-profit-no-loss conundrum in Indian scenario.
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