Traders and kirana store owners in the country are not fully prepared to face foreign retailers, said Mr Madan B. Desai, Former President of the Karnataka Chamber of Commerce and Industry (KCCI).
Addressing the members of KCCI, Mr Desai said, “If the Union Government allows 51 per cent foreign direct investment (FDI) in retail trade and multi-brands, it may lead to more unemployment and competition with capitalists for which we are not fully prepared.”
Companies like Wal-Mart and CarreFour are already showing their strong hand in the international market. “These companies will eliminate lakhs of small traders and create unemployment for few crores of people and ultimately help major countries like China, Japan, South Korea, Thailand and Hong Kong,” said Mr Desai.
“By outsourcing nearly 80 per cent of the products they need for marketing in India as they are more competitive in price and quality over their Indian counterparts,” he added.
Dr. N. A. Charantimath, while addressing the gathering, said the multinational retail traders would seek more concessions in several taxes and other infrastructure at cheaper rate if the Government allows 51 per cent FDI in multi-brand retail business. Within a short period, small traders will be compelled to shut down their business and will be unable to find other alternative means of living .
Small traders and kirana store owners lack in finance and infrastructure. Most of the people are small traders and they are not properly equipped to compete with the foreign traders, and people in large numbers depend on the small traders for their livelihood, he said.
“There is a fear in the minds of the small traders as well as the people at large because the issue of retail trade vast, for which it needs to be debated and it is not the right time to introduce FDI in retail trade in India. So it is the opinion of the speakers to defer the issue till we reach consensus amongst all the states,” he added.