FDI in retail would hit Indian traders, says BJP

BJP's apprehension that the decision to allow 51 per cent FDI in multi-brand retail sector would wipe out Indian traders is absolutely true.The gravest impact of FDI in retail trade will be on the family run tiny retail shops. Tens of thousands of tiny retail outlets have gone out of business in the West as they were not able to compete with companies like Wall-Mart, Tesco and Carrefour. The retail market is not infinite; therefore the growth of corporate retail will mean the loss of local shops and employment. The employment potential in the retail sector will go down very much as the proportionate employment in relation to total sales is much less in the retail chain stores organisations. The establishment of local corporate retail outlets has already caused the extinction of many unorganised retail outlets. A study by RFSTE/ Navdanya has shown that nearly 90 percent small retailers have been negatively impacted within a few months of a Reliance Fresh store coming up in the Delhi and NCR neighborhood; 87 percent said they will have to close their shops because of declining business; and 66 percent small vendors said that they would be affected. Thus, corporate retail has is clearly growing at the cost of small retail jeopardising the employment and livelihood of millions of persons all over the country. Dr.C. Murukadas, The  Economic Times ,20 Sep, 2012