Vizag consumers say FDI benefits them

Vizag consumers say FDI benefits them
By SNV Sudhir
Visakhapatnam, Dec 8, 2011: A survey conducted by the students of MBA in retail management at Andhra University in the city revealed that consumers opined allowing 51 percent Foreign Direct Investment (FDI) into retail trade would benefit them and also help for the growth of retailing in India. However the entry of well established multi national companies will certainly affect the young Indian corporates in retail sector and millions of small scale retailers depending on this sector for livelihood. At the time when entire nation is debating on the contentious issue of Centre’s decision on allowing FDI in retail trade Andhra University students conducted a sample survey on 700 local consumers to know their take on the issue.
Interestingly 64 percent revealed that consumers will be benefited with the government’s decision to allow FDI in Indian retailing. Around 65.43 percent of the respondents opined that that it will help for the growth of retailing in India. Whereas 21.14 percent responded negatively. The majority of the respondents around 57.43 percent revealed that the government’s decision to allow MNCs in retailing affect the Indian corporate retailers and 62 percent felt that it will also affect small scale retailers.
“The crux is that though the FDI in retail sector helps in the growth of the sector and benefits the consumers it is too early to allow the FDI. The corporates and the small retailers be given sufficient time to establish themselves and to gain competencies to face competitive threats from the MNCs,” said Prof K Rama Rao who guided the students to conduct the survey. The questionnaires were campaigned at the premises of shopping malls, departmental stores and small retail outlets by the students of MBA in retail management.
Prof Rao further added that retailing is one of the fast growing business segments in India. Many Indian companies had just entered in retail sector and trying to establish themselves in the business in line with the international giants. The share of organized retailing in India is only 5 percent as against 20 percent in China and 40 to 60 percent in many developed countries. Therefore Indian retailing is dominated by millions of small scale retailers. Any policy towards retailing should kleep in mind the millions of small scale retailers and their dependents, opined Prof Rao.