1. FDI IN
RATAIL
Is It Good Or
Bad for Indian
Economy?

2. INTRODUCTION
 Meaning of FDI:-
FDI stands for foreign direct
investment i.e. investment made by the foreign
companies or foreign government in India. It is mainly
dealing with monetary matters. FDI is a popular mode of
entering in another country’s economy. It is made by
foreign countries in order to established wholly owned
companies or to manage them or to purchase shares of
companies in another country. It can be of two type-
1) Horizontal –invest in same type of industry.
2) Vertical- financial collaboration with mkt. unit or
suppliers of input in that country.

3.  This is the most talked and controversial issue in the
country right now. On 15th sep. 2012 govt. has
announced their new FDI policy in Indian retail
sector. As per the notification by the DEPARTMENT
OF INDUSTRIAL POLICY AND PROMOTION the
govt. has allowed FDI in following-
 Single Brand Retailing-100%
 Multi Brand Retailing-51%
This new policy facing protest from everywhere for
instance- Left Parties, Opposition
Parties(BJP,SP,INLD Etc.) & from the general public
also.

4.  This is all because as much as 7.8% of India’s
total workforce is engaged in retail trade.
There are two type of retail stores in India.
They are-
1) Organized Retail stores
2) Unorganized Retail stores
Unorganized retail stores are considered to
be the 95% of the total retail sector of India. It
is argued that these are going to effect to a
large extent with the entry of big MNC in
retail sector like- Wal-mart, Tesco, Correfour
who sell from groceries to garments, furniture
to fitness equipment item under one roof.

5. ARGUMENTS AGAINST FDI
 As the government decision is facing protest from
everywhere the different parties called for the “BHARAT
BAND” or “INDIA CLOSED” on 20th sep.2012. They have
given their arguments against the FDI. These arguments
are as-
1) Create Unemployment
2) Upset the balance of payment
3) Farmers would be at loss
4) Middle man would suffer the most
5) Inflation will be increased

6.  The union minister of STATE OF INDUSTRY &
COMMERCE Mr. JYOTIRADITYA SCINDIA tried to
protect govt. decision regarding FDI by giving
some arguments in favor of FDI or focusing light on
the benefits of FDI for India. These benefits are as-
1) Benefits for consumers
a) Good quality
b) low price
c) Quality of services
2) Benefits for producers
a) Low advertising cost
b) Opportunity to go international

7. 3) Benefits for economy
a) Increase flow of foreign currency in the country.
b) Latest technology in production
c) improved infrastructure facility
d) create employment
He said that if India want to become a superpower in world
economy then it is very much important to open doors for
FDI coz only then we can avail all these benefits. He also
said that the govt. has announced this FDI policy by
keeping in mind the interest of general public and as well
as the economy by putting some restriction on FDI.

8. RESTRICTION ON FDI
or
STEPS TO PROTECT ECONOMY’S INTEREST
 FDI in retail would only enter in 10 states & those cities
where population is more than 10 lakh and only 53 cities
comes under this criteria.
 Only those MNC who are willing to invest 500 crore, half
of it in the back-end activities such as
logistics, infrastructure etc. would be allowed in the retail
space.
 The foreign retail stores will have to buy 30% of the
product from the domestic producers.
 The unorganized retail sector would not be affected so
much coz they have already created great neighbourhood

9.  After studying all the arguments against and in favor of
FDI we can conclude that the govt. decision is a good
decision coz it is very much important for Indian economy
to grow with world’s economies and this can be possible
by exploiting all the opportunity available in the intt.
market and FDI is a good medium for that.
 Moreover it has more positive effect than negative effect.
So, we should concentrate on the positive part and try to
remove the hurdles that are in the path of successful
implementation of FDI policy.

10. THANK
YOU