SYNOPSIS ON IMPACT OF FDI ON INDIAN MARKET WITH SPECIAL REFERENCE TO RETAIL INDUSTRY

INTRODUCTION

Foreign direct investment (FDI) plays an extraordinary and growing role in global business. It can provide a firm with new markets and marketing channels, cheaper production facilities, and access to new technology, products, skills and financing. For a host country or the foreign firm which receives the investment, it can provide a source of new technologies, Capital, processes, products, organizational technologies and management skills, and as such can provide a strong impetus to economic development. Foreign direct investment, in its classic definition, is defined as a company from one country making a physical investment into building a factory in another country. Foreign direct investment (FDI) is considered to be the lifeblood for economic development as far as the developing nations are concernedForeign direct investment (FDI) has the potential to generate employment, raise productivity, transfer skills and technology, enhance exports and contribute to the long-term economic development of the worlds developing countries. More than ever, countries at all ates of some 64,000 transnational corporations (TNCs) generate 53 million jobs. FDI is the largest source of external finance for developing countries. Developing countries inward stock of FDI amounted to about one third of their GDP, compared to just 10 per cent in 1980. Foreign direct investment (FDI) has become a key component of national development strategies for all most all the countries over the Globe. FDI is considered to be an essential tool for jumpstarting economic growth through its bolstering of domestic capital, productivity and employment. FDI to developing countries in the 1990s was the leading source of external financing. The rise in FDI volume was accompanied by a marked change in its composition. That is investment taking the form of acquisition of existing assets (mergers and acquisitions) grew much more rapidly than investment in new assets particularly in countries undertaking extensive privatization of public enterprises. 2. FDI IN RETAIL BUSINESS India is tipped as the second largest retail market after China. Retailing is the largest private sector in India and second to agriculture in employment. India today has perhaps the highest retail outlet density with approximately 15 million retail outlets. The entire retail trade contributes about 10-11% to Indias GDP and is valued at an estimated Rs 9, 30,000 crores. Out of this, organized retailing industry is around Rs 35,000 crores. Organized retailing is primarily urban centric, its share as represented in urban scenario is projected to be 12 to 20%. Growing at more than 30%, the organized sector is driving the retail growth in India and contributes significantly to the growth of the economy. This economic growth comes primarily from increased consumer spending. The Government approved sweeping reforms in FDI with a first step towards partially opening retail markets to foreign investors. It will now allow 51 per cent FDI in single brand products in the retail sector. Besides retail, other sectors are being opened: 100 per cent allowed in new sectors such as power trading, processing and warehousing of coffee and rubber. FDI limit raised to 100 percent under automatic route in mining of diamonds and

precious stones, Satendra Bhardwaj et. al / VSRD International Journal of Business & Management Research Vol. 1 (8), 2011Page 572 of 577development of new airports, cash and carry wholesale trading and export trading, laying of natural gas pipelines, petroleum infrastructure, captive mining of coal and lignite. Subject to other regulations, 100 percent FDI is allowed in distillation and brewing of potable alcohol, industrial explosives and hazardous chemicals. Indian investor allowed to transfer shares in an existing company to foreign investors. Limit for telecoms services firms raised to 74 per cent from 49 per cent.

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Profile of Raymonds

Raymond was incorporated in 1925 and is a leading Indian textile major. The company is part of global conglomerate Raymond Group. Raymond was the first in 1959 to introduce a polywool blend in India to creating the world's finest suiting fabric the Super 240s made from the superfine 11.6 micron wool. It produces wool-blended and premium polyester viscose worsted suiting. Besides, textile company has also diversified in engineering and aviation. Raymond is largest manufacturer of steel files in the world accounting 30% of market share. Raymonds textile plant is located in Thane, Vapi and Chhindwara. These plants have received various certifications such as ISO 9001 for quality management systems and ISO 14001 Environment Control Systems. Businesses Textile- Under this it manufactures worsted fabrics, wool and wool blended fabrics. It has production capacity of 33 million meters per annum and has a product range of nearly 20000 design and colours. The company exports to over 55 countries that include USA, Canada, Europe, Japan and the Middle East. It retails the products through 30,000 stores in over 400 towns across India. Engineering- It has three engineering divisions namely JK Files & Tools, JK Talabot and Ring Plus Aqua. It manufactures steel files, tools, Starter Ring Gears, Flexplate Flywheel Assembly, Profile Sheet Formed Metal Pulleys and Integral Shaft Water Pump Bearings. The export performance has been recognized continually year on year by the Engineering Export Promotion Council of India and the Engineering Files Panel of India. Aviation- The company was one of the first corporate houses to launch Air Charter Services in India in 1996. It owns 1 Ecureuil AS 355N Twin Engine Helicopter, 2 Bell 206 L3 Long Ranger Helicopters and 1 Challenger CL-604 Business Jet Aircraft.

Date of Establishment Revenue Market Cap Corporate Address

Management Details

Business Operation Background

1925 0 ( USD in Millions ) 16416.30913485 ( Rs. in Millions ) Plot No 156/ H No 2,Village Zadgaon,Ratnagiri415612, Maharashtra www.raymond.in Chairperson - Gautam Hari Singhania MD - Gautam Hari Singhania Directors - Akshay Chudasama, B V Bhargava, Boman R Irani, Gautam Hari Singhania, H Sunder, I D Agarwal, Nabankur Gupta, Nana Chudasama, P K Bhandari, Pradeep Guha, R Narayanan, Shailesh Haribhakti, Shailesh V Haribhakti, Thomas Fernandes, U V Rao, Vijaypat Singhania, Vijaypath Singhania Textile Raymond was incorporated in 1925 and is a leading Indian textile major. The company is part of global conglomerate Raymond Group. Raymond was the first in 1959 to introduce a polywool blend in India to creating the world's finest suiting fabric the Super 240s made from the superfine 11.6 micron wool. It produces wool-blended and premium polyester viscose worsted suiting. Besides, textile company has also Total Income - Rs. 19590.372 Million ( year ending Mar 2012) Net Profit - Rs. Million ( year ending Mar 2012) Thomas Fernandes Bank of America, Bank of India , Bank of Maharashtra, Central Bank of India, Citi Bank, HDFC Bank, HSBC Bank, Standard Chartered Bank, State Bank of India Dalal & Shah

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OBJECTIVE OF THE STUDY OF HOME LOANS