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Created by : Malika , Business Analyst, Essar Group Of Companies  | 08 06 2010 08:27:03 +0000
Industry : Retail Chain/LogisticsFunctional Area : Business Policy(Strategy & Execution)
Activity:  693 views;  last activity : 06 15 2011 06:58:43 +0000

The Credit Rating and Information Services of India Limited (Crisil), one of the leading research firms, has said that foreign direct investment (FDI) in multi-brand retail could help ease the problem of high food prices, an issue on which the government is fighting a major political battle.


http://www.flonnet.com/fl2302/images/20060210000907801.jpg

The food inflation has mostly remained in double digits ever since it was introduced in November 2009. The issue of high food prices had also stalled parliament throughout the last month.

So, can FDI in Multi-brand retail help ease food prices & reduce wastage??

 
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Yes Vs No
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Top Argument
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I think with the change in FDI policy is likely to stimulate a flow of investments from organised retailers and logistics companies into establishing quality supply-chain infrastructure for fresh fruits and vegetables. Here Indian consumers pay nearly 2-2.5 times the price paid to a farmer as compared to 1-1.5 times in developed markets where the penetration of organised retail is much higher.

Currently, India does not allow FDI in the politically sensitive multi-brand retail sector but 51% foreign investment is permitted in single-brand retail. And here almost 50% of the annual wastages could be prevented if fruit and vegetable retailers have access to specialised cold storage facilities and refrigerated trucks.  So, allowing FDI in multi-brand retailing helps in getting down the prices according to me people.


By Malika , Business Analyst, Essar Group Of Companies  08 06 2010 08:27:03 +0000
 
Top Argument
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Because their economies in doll drums they will try to earn more from Indian market & as being done by EAST INDIA COMPANY THE SAME THING WILL HAPPEN. Instead of this We have excellent market, we are blessed by God & Nature & can grow food articles for more then 8 months we must follow our old proven techniques & make the India SONE KI CHIDIYA back.
By AJAY GOKHALE, DY GENERAL MANAGER MATERIALS, FINOLEX INDUSTRIES LTD.  08 16 2010 03:41:41 +0000
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you're right ! I agree with your point.


By Rajeev K Jha, India Head - Permits & Liaisoning  | 06 15 2011 06:58:43 +0000
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Thanks for the support - I see a maturity in approach to the situation, one desperately reqd in our systems!

Operations are suspect & prone to severe hoarding/ presenting money making angles to many of our erstwhile corporators - the so called agents of doom!

But new storage technologies will help cut down the tremendous wastages that continue to happen - we need to think who are the biggest losers in this!!

The new approach must be stringent in enforcement while presenting change to old/ archaic views, bringing in much needed change to boot.

New technologies will boost significantly, per hectare yields & bolster storage as well as efficient/ quick movement - cutting down on our surpluses rotting away/ not reaching the intended in time! 

Increased FDI will enforce transparency, stem the rot discouraging hoarding. India will have maximum mouths to feed within the next decade or so & the organised process can only help

Yes, it will temporarily increase prices but in an organised fashion, enabling better control & eventual stability - there is no short term solution. 


By Amit Abrol, Business Owner , Primexp  | 08 22 2010 17:25:27 +0000
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stream lining procurement and assessment of demand can lead to production that is tuned and ensure fairness to both consumers and producers.The accountability part will be necessitated by the system and govts. can also earn revenues by taxes and service charges. And above all the whole world market can be brought into a basket and dealt with excellence.
By p.m.n.krishnan , ADMINISTRATION, NGO TRUST  | 08 22 2010 06:35:34 +0000
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I think India need to carefully start FDI in retail sector, as its effects are still well talked than realized.

Increasing supply chain efficiency are must for Indian economy, but if it happens with majority Indian stake then it would be great for Indian economy. exposing farmers to multinational will make them prone to legal exploitation, and small farmers will not be able to get benefits. Also if we believe that Wallmart will provide similar services like in USA, we are at mistake. Retail giants will have their India specific policies which will include exploitation inside legal barriers and unless we have legal framework in place to protect interests of Indian farmers we should restrict in pushing FDI.

Even if we allow large scale FDI in retail sector, not huge investments will start flowing into rural parts. These investments will be largely concentrated on urban areas, which will not yield the actual and expected benefits.


By Amit Misra, Software Engineer -4 , Juniper Networks  | 08 16 2010 10:04:57 +0000
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Would enhance the functioning of Retail Chains throughout the Country thru advance infrastructure, directly boosting the penetration of Organized Retail.
By Varun Mishra, Operations Executive, Shoppers Stop  | 08 16 2010 08:51:22 +0000
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Ya i think it can help, increased competition for big retail giants will put additional pressure in sourcing food supplies at lower prices and providing value to customers by maintaining lower margins. reduction of wastage depends on operational efficiency which will definately remain a focus issue.
By Omkar Nandi, Business Analyst Merchandise planning TARGET  | 08 16 2010 05:08:42 +0000
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FOOD PRICES ARE SOARING UNKNOWN HEIGHTS . I THINK YOUR SOLUTION IS THE BEST PATH TO BE TAKEN.


By Shampa Bose, copywriting and designing, Love ads agency  | 08 09 2010 04:06:00 +0000
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I think FDI can reduce prices because in my view point most of price rise problem is in India due to black marketing and corruption
By Gurpreet Singh, Team Associate, BA Continuum Solutions  | 08 07 2010 17:01:13 +0000
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The flow of fund may bring in materials more, and subsequently, to certain extend , possibly reduce inflation of price.Is it not wise to float money to fetch more things to reduce prices.? I hope it can, to some degree, reduce inflation in prices.


By KALIYAMOORTHY , Oil & Gas Area Coordinator, Undisclosed  | 08 06 2010 15:16:33 +0000
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Like in almost every other industry, we need to learn how to handle our excess/ surplus, storage, enhanced marketing efforts for better sales etc. We need to learn from the examples available to us & there should be no shame in doing that!

Those that are better & have done it in the past, are to be considered prime examples & FDI proposes to bring it in, so be it! Inflationary pressures it can create but those need to be preempted & dealt with, keeping in mind the larger picture.

And the larger picture includes reducing mindless wastages, unnecessary hoarding, getting better prices for final produce due to quick/ efficient transportation, adequate micro-financing for the needy & so on

What we do need to be wary of is political pressure, that follows the scent of votes & does not exactly follow whats good for the public. The same political pressure that wishes to ward off FDI for reasons that it reduces possibility of their personal gain.


By Amit Abrol, Business Owner , Primexp  | 08 06 2010 10:39:34 +0000
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I feel it will ease somewhat, only with increase in infrastructure investments,Although increase in FDI results in excess liquidity which is one of the reasons for inflationary pressure. But its also true that in India food wastage is very high from farm to consumer and if that can be contained, it will result not only in easing the pressure on Prices but also on India,s self-reliance on food products. 


By Anupam Pandey, Asst. Manager/Manager (Technical), Indian Air Force  | 08 06 2010 10:14:32 +0000
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FDI only result in raise in food prices.
By S.SUBASH , General Manager - Realty Promotion  | 08 06 2010 08:59:36 +0000
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I DNT THINK IT WILL REDUCE WASTE BUT IT WII REDUCE PRICE


By Davies francis, Analyst, self  | 08 22 2010 09:18:41 +0000
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I had voted A big" NO" because no resourses means no more space as a property to accomodate them because they use little or sometime oue resources whick were not manage well & if they are so good in managment why they are running from their respective countries in the name of expention,competition and if we are wasting we have to look into our managmemt so if we Manage well why we want SO CALLED FDI`S ATLEAST in retail aam admi is involved so no again in that support
By VEERINDER SINGH(B-P.VIHAR), Associate/Senior Associate, BHART CAPITAL SERVICES  | 08 17 2010 10:18:06 +0000
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Some of the experts had given their views but where are the resources to accomodate FDI`S.


By VEERINDER SINGH(B-P.VIHAR), Associate/Senior Associate, BHART CAPITAL SERVICES  | 08 17 2010 10:00:55 +0000
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First we have to look into the resourses we have and FDI can also use the some of them might be little/smaller/some or the other time SO when their is little resourses and competition in their repective countries how they can deal in our country with so many little space as a property/resource etc.


By VEERINDER SINGH(B-P.VIHAR), Associate/Senior Associate, BHART CAPITAL SERVICES  | 08 17 2010 09:58:11 +0000
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 Huge investment in the food market will be resulted in huge stocks of food grains. few people / company will use to con troll over the market or impose their monopoly in this trade with the help of their huge investment capacity. It may be resulted in exploitation of our nation. It should must be remembered that the companies are not religious or social orgainasation constituted by  sadhu-sants. they are comming here to earn profit.


By Radha Raman, Advocate at Patna High Court., Raman Associates  | 08 06 2010 17:20:15 +0000
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