FDI in Retail - Boon or Bane?
                     FDI IN 
RETAIL: BOON 
OR BANE?
Introduction
Foreign Direct Investment (FDI) in retail 
means foreign direct investment in the 
Indian retail business. The retail business 
can be either a single brand retail 
business or multi brand retail.
Source: blog.oureducation.in
Present 
Scenario
At present, foreign direct investment (FDI) 
in pure retailing is not permitted under 
Indian law. 
Government of India has allowed FDI in 
retail of specific brand of products. But the 
major concern is regarding the 
government’s decision to allow FDI of 51% 
under multi brand retail.
Source: blog.oureducation.in
FDI IN RETAIL: BOON
Supply Chain
• FDI in retails’ would mean the re-birth of 
an advanced supply chain management 
(SCM) structure. People are fooled to pay 
an enormous amount for a product which 
usually has a cheaper market value. 
• This new management system is 
expected to work for the benefit of all 
the farmers of this country. With proper 
research and execution of this project, 
there could be a drastic change in the 
economy of India.
Source: www.groupdiscussionideas.com
Market 
Demand
• It is firmly believed that Narendra Modi 
has set his goal for deploying 100% FDI 
in the food retail stores. 
• This, in turn, conveys that the market 
demands better food storage, with the 
best cooling machines and refrigerators.
Source: www.groupdiscussionideas.com
Technology
• India being a developing country, starves 
for more advanced technology and tries 
to be in sync with the rest of world in 
terms of market competition and 
industrialization. 
• Hence, for the success of FDI in retail 
stores, the investors would need 
improved business practices and 
qualified technicians to control the entire 
management.
Source: www.groupdiscussionideas.com
FDI IN RETAIL: BANE
Massive loss 
of jobs
• Like WALMART, a multi-retailed store 
established in the US, currently 
established retail stores in India 
including the Kirana stores would be 
compelled to close their business leading 
to a massive loss of jobs and discomfort 
to a large chunk of society. 
• Also, to match up with the current 
technology war, these new stores are 
expected to be much more advanced 
and automated which is a bad news for 
our less skilled labours.
Source: www.groupdiscussionideas.com
Monopoly
• The concept of multi-retail stores 
revolves around the idea of the sale of 
multiple brands at a single outlet 
providing people with the luxury of high-
class facilities and services. 
• Such FDI controlled retail stores would 
soon fix their monopoly over the country 
which could have a negative impact on 
the Indian trade.
Source: www.groupdiscussionideas.com
Follower
• By encouraging Foreign Direct 
Investment to take over the retail stores, 
India could become a follower of 
Organization of Economic Cooperation 
and Development(OECD) under which all 
the FDIs work.
Source: www.groupdiscussionideas.com