FDI in retail – a boon or bane for Indian economy and farmers?

Written by  Sheikh Noorul Hassan

 

The recent government decision to bring radical economic reforms mainly by bringing FDI in multi brand retail is in no way going to change the India’s Economy. According to some eminent economist, the present economic growth rate of 6.5 will remain for another three years. FDI in multi-brand retail notification of government of India has many shortcomings. The government of India has not laid down any provision for autonomous regulatory mechanism for infrastructure buildings instead Walmart has been empowered with self certification. Without having regulatory mechanism Walmart has been made god in it, it will only benefit Walmart.
The government’s argument that it will help in building world class infrastructure and save from wasting million of quantities of food grains which has become order of the day at government’s warehouses is nothing but an eyewash.  Another shortcoming is that there will be no legally abiding contract between the farmers and middle suppliers which will lead to farmer’s sufferings. The relation between Walmart and farmers will be linked through middle suppliers, which means there will be no legal contract between farmers and middle suppliers. The rights of farmers are not protected and Walmart will not be responsible as a final employer. The Walmart will have direct contract with middle suppliers which is an indication that hundreds more dummy companies will be formed. The so-called creation of large number of employment will only be unfulfilled dreams. There is no possibility of creating more employment except the present small vendors becoming an employee of Walmart. The street vendors at the least may be employed by Walmart but it will not help in creating million plus employment therefore it will not help in solving the rising unemployment problem of the country.
The politician and media are making different and wrong argument without understanding the real cause and issues related with the FDI notification. Politician of this country is only concern with their own benefit so they are hiding the real concern associated with FDI in multi brand retail. The government is trying to sell their faded face with some sort of cosmetic surgery in the form of FDI in multi brand retail and propagating wrong arguments. The FDI is neither good nor bad but it is more towards bad.
The economy in 1991 was quite different from the present economy; in 1991 there was no Facebook. The situation and circumstances 21 years before and today cannot be compared. India’s today liberalised economy is in more bad shape than 21 years ago. The world has also changed enormously in terms of economic equation. In past more than fifty years, the government of India has failed to bring any positive change or improvement in India’s agriculture sector than do we can think that Walmart will ever  bring improvement. The answer is obvious no. In past fifty years, the irrigation system, productivity level, use of new technologies to improve the Indian agriculture products has been given marginal importance though India’s economy mainly depends on agriculture. The conditions of Indian farmers is still pathetic and government has never seriously thought or brought any landmark reforms to improve their conditions accept lips service.
It is very hard to believe and think that this sudden move will bring radical change in the life and soul of Indian economy and farmers. The government of India should rethink and rework on FDI in multi-brand retail mechanism before it is implemented otherwise it will only help in bringing unwanted sufferings for Indian farmers and agriculturist. It is also to be reminded that Walmart is the brand which is forced to leave many developed countries because of its foul practices. Is it really needed to bring a foreign player in Indian Agriculture sector? Why cannot government bring FDI in power, education, energy sectors if they are really bothered about Indian economy and country’s development? It will remain an area of debate for a layman like me.