Opening up the retail sector to foreign direct investment is a welcome move that represents significant benefits to farmers, according to Mr Manikam Ramaswami, Chairman, Agriculture Forum, CII Southern Region.

Mr Ramaswami said entry of large multinationals into food retailing will help address major concerns for the farmers — marketing, right pricing and market information. Multinationals have the capacity to provide adequate support, pricing and supply chain management, he said.

However, he cautioned that the foreign players should be treated on par with their domestic counterparts here. Foreign investors should not be provided more favourable treatment than existing players as had been done in manufacturing sector.

In a statement from the Confederation of Indian Industry, Mr Ramaswami said, foreign direct investment in retail sector in India can turn out to be an important inflation-busting measure. It would boost FDI, which dipped by 25 per cent to $19.42 billion in 2010-11 from $25.83 billion in the previous fiscal.

Better supply chain and technical know-how will ensure efficient movement of produce from farm to shop floors, benefit farmers and consumers. Modern retail marketing will in the long term upgrade agriculture.

Mr T.T. Ashok, Chairman, CII Southern Region, said the South has been looking forward to Foreign Direct Investment that will enable backward integration and investment in farm-to-fork. Karnataka, Andhra Pradesh and Tamil Nadu will be able to move their produce more efficiently to access market across the country. Opening of FDI in retail will catalyse organised retailing, and provide opportunities for micro, small, and medium companies in food processing and packaging sectors.

rbalaji@thehindu.co.in