FDI Retail in INDIA ADVANTAGES 1) It will create up to 10 million jobs in next 3 years.

The jobs will be created in the agro and food processing industries, packaging, bottling, canning, containerising, as well as transport sectors. 2) RBI has said that it will cool down inflation due to increased competition. Consumers will get products at cheaper prices. 3) The policy also mandates that at least 30 per cent of the procurement of manufactured/ processed products shall be sourced from 'micro and small industries which have a total investment in plant and machinery not exceeding $1 million. 4) Approval only after investors meet all conditions, including 50% investment in back-end Government will have the first right over procurement of farm produce 5) The organised retail market is expected to be Rs 3.5 lakh crore from the present Rs 1.4 lakh crore, according to a CRISIL report. 6) Also the retail policy in countries such as China, Thailand, Russia, Indonesia, Brazil, Argentina, Singapore and Chile where 100 per cent FDI is permitted have posted impressive growth in those countries. Therefore, the new policy would not adversely impact small retailers in India LIMITATIONS/CHALLENGES 1) TheAgricultural Produce Marketing Committee (APMC) Act in the states denies farmers and buyers the freedom to buy and sell freely and empowers a group of middlemen. This Act must be either scrapped or amended to exclude perishables from its ambit, if organised retail is to begin procuring fruit and vegetables directly from farmers. 2) Walmart and other foreign retail chains might invest in warehouses, but not in power generation or rural roads. Ideally, farm produce movement over long distances, say from Assam to Delhi, should take place by trains that run according to a predictable schedule and have refrigerated cars. Thus , their activities will need better support from the government also. 3) The decision of allowing the multiretailers still lies with the respective states.

4) Small industries have raised serious concerns over the controversial policy, which gives liberty to the foreign players to source 30 per cent of their requirements from MSEs anywhere in the world.

On the reason for liberalising the FDI policy on retail trade, Mr Sharma said, Unless and until this is done (liberalise retail trade), we will have a situation where the farmer bleeds and the consumer is fleeced. The new policy will result in better returns for farmers, cheaper options for consumers as well as help attract the latest technology in retail infrastructure, in cold chain and in value-addition, he said. An official statement said only 53 cities qualify for FDI in multi-brand retail out of nearly 8,000 towns. Mr Sharma said minimum amount to be brought in as FDI by the foreign investor would be $100 million. The Minister added that at least 50 per cent of total FDI brought in shall be invested in 'backend infrastructure'.