Foreign Direct Investment means investment of capital in the retail sector from players from other countries. The retail sector consists of all the products that are directly sold to customers. These products are foods, clothing, accessories, lifestyle goods, and the likes.
When the government allows FDI in retail, it allows foreign players to have stocks/interests in Indian companies or a certain percent of foreign players can do direct business in India.
Why FDI is good for Indian Retail?
- Arrival of foreign players will trigger healthy competition among retailers
- Healthy competition would mean Indian consumers will get the best of the quality
- Competition will also help in bringing down the prices
- Farmers in India will get a better share for their production due to direct procurement by foreign companies
- More foreign companies will create more jobs in India
Why FDI is bad for Indian Retail?
- Local markets and stores will struggle to survive
- Domestic products will suffer in the presence of cheap imported products
- Foreign companies may look for monopoly which is bad for Indian market in the long run
How can FDI be implemented efficiently?
- The percentage of FDI must be restricted, domestic market must be expanded
- Government should formulate policies to increase domestic production before inviting FDI
- The interest of the local farmers must be kept on priority and rules must be framed about their share
Choose to speak either in favour of or against FDI. Never change your stand in the middle of the GD. Stick to your points with examples and arguments.