FDI IN RETAILING’ - A FUTURE PROSPECT

Abstract

The opportunities in Indian retail are immense, all players must be aware that the consumer culture, business practices and industry dynamics in India can differ substantially from what they are accustomed to at home, often leading to pitfalls for the unprepared. Opening up the retail sector to foreign direct investment (FDI) would be beneficial for India in terms of price and availability of products India with a population of more than one billion has become a magnet for many international industries who found their growth to be stagnating due to a saturated domestic market in their countries. With a robust economy experiencing sustained growth, India is proving to be an irresistible temptation to companies looking to expand their scope of operations. With the government showing proclivity in allowing FDI for high end and grocery retailing, the idea of permitting FDI in the Indian retail sector is slowly gaining momentum. Things had begun to look up since the late 1990s, with a boom in the consumer durable industry, and improved services. With rising income and changes in life style, demand for better products became insistent. Foreign direct investment (FDI) inflows into the country have more than trebled in the first six months of calendar year 2007 to $11.4 billion as compared to inflows of $3.6 billion received in same period last year, registering a growth of 218 per cent. India offers vast potential in retail business and this potential must be fully realised by exploited, by making the country an attractive destination for FDI. The study suggests the measure & techniques to overcome the legal restarints