So how will FDI affect him.
- Zero cost of land – (theoretically)… he probably has to pay bribes because he is squatting between the pavement and the road, blocking both.
- Bang opposite a station (Vile Parle) – en route for customers who get off and wind their way home
- Can bargain – especially close to closing time
Or him
Well, same as above. free land (blocking pavement – squatters rights, possibly pays bribes)
I haven’t seen this in the Indian malls – seen plastic stuff – but not good old earthen ware.
Unless FDI gets single brand earthenware shops or IKEA suddenly decides to stock matkas, can still see this guy around for the next few decades.
Hopefully, he will sell more, if environmental concerns on plastics catches up with consumers.
How about him
This is the local kirana, supposedly most impacted by FDI…
Is he going to be impacted ? conventional wisdom says yes.
But, frankly I don’t know. The crowd that goes to malls to shop is not the same that shops here. In fact, many of the people who shop here will possibly never step into a mall. My maid (she earns around 12k a month between all houses), refuses to go into a mall. When a Big Bazaar has is offers – Rs.599 get rice, oil and dal – she gives my mother money and asks her to buy the pack for her. She finds the mall confusing. Plus, the Big stores sell large volume packs – she doesn’t have place to store – there are rats, rains, and space issues. She is the biggest chunk of the consumer market – not you and I.
People who go to this shop (it is opposite my office) – buy in small quantities (250 gm toor dal dedo), buy sachets and have a range of pulses and FMCG products I don’t see at the Bigger stores.
Yes, and he home delivers. The question is, can your bigger stores compete with him…
—————
So who is impacted ? The middle man, the dalal, the man who makes a percentage for brokering. A man who possibly deals in cash and pays little in taxes. A man who is possibly a political animal -having his feet in both parties. And, I am supposed to feel sorry for him… why ?
___________
Addendum
Barbarian Indian (yes i ‘know’ someone called that) on twitter pointed out
Disgustingly tilted post, I support FDI (actually there is nothing to oppose) but you are missing some pictures here!. The farmer who will lose his land (FDI will enable mega stores, more land), the Kirana employees who will be fired within say 1 Km radius of any Walmart (volume will be lower, kirana store won’t employ as many), the farmer whose land will be usurped by larger farms. The point is, you can’t make omlets without breaking an egg. Making such a rosy picture stinks of bias.
FDI in retail is announced in 53 cities. States have the right to refuse – many have. I can’t see how FDI in retail in 53 cities will get farmers to lose land. Unless of course, the back end storage facilities are put up in villages. Again, that doesn’t make sense – primarily because of the situation with erratic power supply in rural India. And, even if miraculously, the Walmarts of the world put up their own power supply (lets say solar or wind energy) to power their storage facilities in rural India, you are talking of employment being generated. A marginal farmer tilling 1 acre of land eking out an iffy living, harvest to harvest, suddenly has an option of a regular income. He may, of course, choose not to sell land and continue farming.
The Kirana has survived the Big Bazaar and the Star Bazaar, Reliance Fresh, Spensers – in big cities and still coped. If a walmart comes up, in a 1 km radius – wouldn’t a kirana employee prefer a higher paid, slightly more up scale job ?
I really don’t get the point on farmers’ land being usurped by larger farmers – it happens today. it has happened in the past. Injustice in India, does not really need FDI .. it is a natural state.
Yes. there will be an impact. I am told there will be an impact, therefore there must be an impact. This report by Navdanya – run by Vandana Shiva – talks about the impact in great detail. My problem is that i can understand the arguments on an academic or theoretical level, but i simply cannot see how these argument translate into reality.
Will there be job losses – yes. The way there were when the bus routes took over routes run by bullock carts. But, that is part of change. We can be snobs and say that a bullock cart driver deserves to be a bullock cart driver and nothing but, or you can do something about improving skills and helping them adapt to a new way of doing things. (incidentally, that means a growth in the education and training business as well)…
————————————
And finally, if you told me that all retail giants are bad I would buy that argument. But, if you told me that it is ok for Indian reatail giants to operate, because for some strange reason they will be great employers, be eoc friendly, be good to the local community , and look at low profits because it is in greater good.. and firang direct investment is wrong, i would look at you and say, there is a unicorn outside my window …
Bigmart just doesn’t sell fruits, vegetables, they sell almost anything under the sun. Pharmacy,groceries,electronics, automotive, electricals,jewellery,cloth, shoe,toy,cosmetics, seasonal, hardware, sports, camping, food –just anything you name it.
All these sectors will be affected. High end electronics showrooms will be things of the past as nobody can complete with Walmart on price and if one buying a Rs 1 Lakh value item, going to Bigmart will cause considerable savings.
More than 90% of India’s rural population has less than 2 hectares of land and 79% are either landless or own less than 1 hectare. Practically all of these people will be excluded from the corporate supply chain. (http://kafila.org/2011/11/30/the-governments-claims-about-corporate-retail-and-the-realityshankar-gopalakrishnan/)
When 80% + Indians live on less than Rs 20 a day, large scale FDI on retail will cause monstrous dislocation and even cause social unrest.
The size of Bigmart is equal to India;s whole retail market, close to half a trillion dollar. This gives idea of the size of this company (and others) . It will be first Trillion Dollar company within this decade.
agreed. but if you visit any large city (and FDI in retail is proposed in 53 cities) you already have that. Big Bazaar sells electronics, so does Hypercity. So do the other big retailers.
On the high end show rooms – highly likely they will go. but the Chromas and the Hypercities have not shut them down, don’t think there will be an immediate impact of Walmart.
On those living on less than Rs.20 a day – how will it impact them, any more than liberalisation or socialism has. There have to be very clear policies on poverty alleviation, that don’t succumb to graft. You will find no arguments from me on that.I don’t believe that FDI will impact them. If anything, the fledgling new middle class will be impacted. I believe for the better.
And finally, Let me give you a real life example.
3 years ago a purchased a Sony Vaio from Chroma. The worst consumer experience of my life. This year i exchanged that Vaio for a Samsung, purchased 3 shops away from my office. My first question to him was, if something goes wrong – who goes to the service centre to get the machine fixed. He said ” hum karenge” …i purchased instantly.
Chroma was 500 bucks cheaper on the laptop. But, i paid for the service and the peace of mind… i don’t like faceless salespeople. I have an equation, as does my family, with the local retailer. We continue shopping there. It is not just a transaction. We know them, we know their families, we are part of a community. the Malls have not stopped us from shopping at the local shops. I don’t think FDI will.
If we compare how many TV sets Chroma sells with Walmart’s we will know the gigantic difference.Its just no comparison at all. In fact, Samsung,Sony and others manufacturers will gladly shutdown their showrooms and sell it thro’ Bigmart because they can save money. Bigmart sources items in such a huge huge quantity, nobody can match with its price.
So your approach is, X is happening. I don’t understand X fully well. But look at these tiny brown people. Let me extrapolate how X will affect these unwashed masses.
Sad is the day when there is no remorse that the first instinct isn’t to study X. Or, the second to be apologetic about not having studied.
@ bystander: are you against FDI in retail ?
Pray tell me, how does protectionism help the ‘tiny brown people’ or ‘unwashed masses’ as you put it…
or is this just an exercise in argumentation ?
That’s the problem. How does it matter whether I am for or against?
And some of us aren’t as all knowing and think it’s perfectly logical that one does not know whether it may or may not be a good idea.
Sometimes, we even think the policy decision should not depend exclusively (or sometimes, at all) on the goodness or badness of the result.
Interesting viewpoint. I agree on your comment about faceless salespeople. The personal relation and chit-chat with the local grocer is one of the things i miss when dealing in supermarkets.
Some of my friends supported big retailers (like Reliance Fresh et al) on the count that they might nullify the middle-man commission and thereby giving a better (and possibly) wage to a farmer. I am ignorant as to whether that really happens and hence am quite neutral about these.
I have same questions on Foreign Retailers ? Whose market would they eat into ? The market of the street-side shops or that of the existing big Retailers ?
Small and local kirana store can face bad impact of business through FDI. You can purchase grocery product through local kirana shopping websites or local kirana store.