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Old 17th September 2012, 16:46   #136
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

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Did it help reducing the gap between rich and poor -no .
Reducing the gap between rich & poor is the wrong goal. The correct parameter is whether the poor have a decent standard of living or not.
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Who suffered due to these policies at the time "the common man"
The rich had their ways of getting things before 1992. Post 1991-92, who benefited? Common man. For instance, to get a phone connection, the wait was nearly 2 years. Now, its few hours. One more, 'No Vacancy' board was common in 70s, 80s. Now there is plenty of opportunities for students completing their education.
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Old 21st September 2012, 20:48   #137
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Just heard the Prime Minister talk about the spate of reforms.
I have been pro FDI but was a little worried about the implementation. I must say that this is the first time I have heard him speak so strongly. It does give me a little more hope. Since I am basically a farmer, I'm looking forward to better rates and less fleecing that the local 'aadti' subjects us to.
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Old 24th September 2012, 10:08   #138
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

not sure if FDI in retails is correct or not but there is something that govt is trying to hide from us and in turn trying to push things through without giving due diligence to public opinion.

History shows that those likes of walmart and tesco has first deliberately kept the prices low and killed the local brands and once people are used to it , pushed up the prices through roof . I was watching a similar debate on NDTV & few things came to light .

1 ) Poor farmers , using whose shoulder govt has pushed FDI in retails will continue to languish as like previously. There are gross mistakes in bills that Govt has pushed through . middle man will continue to enjoy the benefits .

2 ) There is no provision for regulation authority. instead onus is on companies to comply and tell the same to govt. it;s anybody;s guess that if they wil comply or not . has anybody seen a thief providing evidence against himself in court ????

3 ) The desperate attempt Mr MMS to justify the FDI . I still don;t understand why he was there to justify it. he could have remain silent ( like previous 9 odd years ) instead of saying that SUV ;s are using diesel and all jazz. Per se him ,prices needs to be increased to provide subsidies to poor, is there a mechanism to monitor if subsidy is reaching poor or not ??? Why the govt is not concentrating on creating capacity themselves. Instead they can build the cold storage and infrastructure themselves and rent to farmers .

All IMO is hog wash . Already there is a FDI allowed in cold storage Setup . Nobody has setup a single cold storage. with retails i suspect if that will improve Further . even if companies build these storage they will use them for their own purpose.Do we think that these companies will give the Stores to farmers on rent to keep their produce . I suspect that. instead they will buy the produce from farmers at dirt cheap prices , kept them in storage and sell at 20 times the profit. In the end farmer will get what he gets already .

All The Subsidy schemes like MNERGA , Health scheme and other Are major Scam IMO. these schemes has not done any thing good for poor but surely , those in charge of these schemes are millionaires .

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Old 24th September 2012, 20:06   #139
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

Can someone please explain how the common man suffered since early nineties when markets were opened up ?
The common man always suffered, after '90s may be a little less because of more available options and added jobs.

I fail to understand one thing completely. What is it that a Foreign retailer with 51% can do which the Indian giants ( Reliance, Big Bazaar etc) cant do ? Are they going to fly in food grains ?

At worst they are going to use some of their tried and tested retail marketing strategies and inject some consumerism here in India. Well, I would say a consumer who falls prey to such marketing would already be a prey to the Indian giants.

At the end of the day, the quality of the stuff they sell matters most. Chinese or not. I dont know of everybody, but people I interact with go to big bazaar for certain stuff, reliance for certain other stuff, Hypercity and Spar for certain other stuff. In 1-2 years since big bazaar was set up, people came to know about the quality of stuff they sell and label it that way.
I may be fine with buying a cheap chinese made all purpose remote control, but I am not fine with buying a chinese mobile phone. Its I as the consumer who decides. If I have a few foreign retailers in my city, I may get imported chocolates at a reduced rate. I may buy food grains from them if they offer a discount, but if the quality is poor, I will stop buying them.

I think foreign retailers can exist in our cities without any disadvantage for the consumer whatsoever.

About the impact to middlemen, I dont see a sea of change coming up, but of course it is going to reduce middlemen. Same with the case of new employment. Not a life saver industry for indian youth, but it is something.
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Old 25th September 2012, 13:26   #140
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

I for one don't believe the Govt's arguments completely. Please remember this is the same government that gave us the Nuclear Deal and at best there were only a handful of people in the whole country that knew about the contents of the Deal. Everyone else was just parroting whatever was told to them. The deal was supposed to lighten homes and no one will be living in darkness and what not, and yet nothing has happened till now. In fact we are in the midst of a Power Shortage, the Grid has broken down 2 times in 2 days, People are facing 10-12 hours Load Shedding in Tier-1 Cities. So what did we achieve by the Nuclear Deal ? Apart from re-electing the Ruling Party, nothing else. Infact now they have got the excuse to not do anything in Power Sector. Till then the Country can go into Dark Ages and suddenly 1 day the Nuclear Deal will save us all.

Similarly is the premise of FDI in Retail. Who is preventing the govt from making infrastructure for storing of food grains ? If the govt itself knows the problems and their solutions, why it's not implementing it ? This is the same govt, that defied Supreme Court's ruling to distribute food grains to poor and said they will allow the stuff to rot but will not distribute it among the poor. Now the same govt is tom-toming about how much food grains are destroyed in India due to lack of infrastructure.

Now let's talk about Foreign Retail Chains and Walmart in particular. I'm pretty sure anyone was has been in the US for even 1 year must know about how Walmart works and why do people oppose it. Everyone in the US knows that Walmart and Predatory Pricing are synonymous with each other. Still why are we projecting Walmart as God's gift to Mankind and answer to all of India's problem ? Do we really think Walmart will be interested in solving India's problems or making profits ? Why are we saying farmers will be benefited when we know Walmart will not pay them 1 paisa more than the prevailing market price. As for the middlemen who we all are fearing and desist, they will become purchase managers of these Big Giants and will continue to fleece and exploit the farmers. Do we really believe that all these people who are working/employed in this sector will just be wiped out from the face of the earth ?

Let's also discuss what is the govt's role and job ? Why do we even need a govt ? When we pay Road Tax and then again pay Toll Tax for a road, what is the govt actually doing ? There are numerous examples like this. The govt is simply outsourcing it's job to private players and then we have to pay the private players, then why do we even pay taxes ? Just for politicians and bureaucrats to fill their personal lockers ?

In my experience, whenever a govt tries to skirt it's responsibility and pass on it to a private player and showcase it as the saviour of India, there's a scam brewing. If we all really think that because of Walmart, Fresco, etc Inflation will come down, then we all are dreaming. The same set of excuses were given when Frito-Lay (Lehar) came to purchase Potatoes and yet we see that Punjab farmers are being forced to dump their potato produce on the road. So has it changed anything ? No. Will Walmart change anything ? No.

This is not the answer to these problems. A better way would be to have a Co-Operative like Amul where they operate on a No Profit-No Loss basis and the purchasing, storage, transportation and distribution is all handled by 1 entity. If it can be successfully in extremely perishable substance like Milk, it can be certainly implemented in Vegetables and Food Grains.
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Old 26th September 2012, 13:12   #141
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Originally Posted by Turbo_Charger
I for one don't believe the Govt's arguments completely. Please remember this is the same government that gave us the Nuclear Deal and at best there were only a handful of people in the whole country that knew about the contents of the Deal. Everyone else was just parroting whatever was told to them. The deal was supposed to lighten homes and no one will be living in darkness and what not, and yet nothing has happened till now. In fact we are in the midst of a Power Shortage, the Grid has broken down 2 times in 2 days, People are facing 10-12 hours Load Shedding in Tier-1 Cities. So what did we achieve by the Nuclear Deal ? Apart from re-electing the Ruling Party, nothing else. Infact now they have got the excuse to not do anything in Power Sector. Till then the Country can go into Dark Ages and suddenly 1 day the Nuclear Deal will save us all.

Similarly is the premise of FDI in Retail. Who is preventing the govt from making infrastructure for storing of food grains ? If the govt itself knows the problems and their solutions, why it's not implementing it ? This is the same govt, that defied Supreme Court's ruling to distribute food grains to poor and said they will allow the stuff to rot but will not distribute it among the poor. Now the same govt is tom-toming about how much food grains are destroyed in India due to lack of infrastructure.

Now let's talk about Foreign Retail Chains and Walmart in particular. I'm pretty sure anyone was has been in the US for even 1 year must know about how Walmart works and why do people oppose it. Everyone in the US knows that Walmart and Predatory Pricing are synonymous with each other. Still why are we projecting Walmart as God's gift to Mankind and answer to all of India's problem ? Do we really think Walmart will be interested in solving India's problems or making profits ? Why are we saying farmers will be benefited when we know Walmart will not pay them 1 paisa more than the prevailing market price. As for the middlemen who we all are fearing and desist, they will become purchase managers of these Big Giants and will continue to fleece and exploit the farmers. Do we really believe that all these people who are working/employed in this sector will just be wiped out from the face of the earth ?

Let's also discuss what is the govt's role and job ? Why do we even need a govt ? When we pay Road Tax and then again pay Toll Tax for a road, what is the govt actually doing ? There are numerous examples like this. The govt is simply outsourcing it's job to private players and then we have to pay the private players, then why do we even pay taxes ? Just for politicians and bureaucrats to fill their personal lockers ?

In my experience, whenever a govt tries to skirt it's responsibility and pass on it to a private player and showcase it as the saviour of India, there's a scam brewing. If we all really think that because of Walmart, Fresco, etc Inflation will come down, then we all are dreaming. The same set of excuses were given when Frito-Lay (Lehar) came to purchase Potatoes and yet we see that Punjab farmers are being forced to dump their potato produce on the road. So has it changed anything ? No. Will Walmart change anything ? No.

This is not the answer to these problems. A better way would be to have a Co-Operative like Amul where they operate on a No Profit-No Loss basis and the purchasing, storage, transportation and distribution is all handled by 1 entity. If it can be successfully in extremely perishable substance like Milk, it can be certainly implemented in Vegetables and Food Grains.
Nuclear deal benefits will be the setting up of nuclear plants in india which is atleast a 4 year project .

Being familiar with the farming conditions and seeing the benefits of a few instances of corporate involvement, I have to say fdi in retail will build the much needed storage infrastructure, provide best quality seeds and other raw material. And better market rates for the produce rather than imposing msp on farm produce!!

It will affect black marketers and hoarders. There will be much needed efficiency in marketing and retailing farm produce.

40 percent of our fruits and vegetables are wasted due to lack of processing and storage facilities.
Our government has no money and no expertise to build the needed infrastructure efficiently.

Like it or not, we need the cash and the expertise!!
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Old 26th September 2012, 13:42   #142
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

Now the Akali's are also switching for FDI, natural since the farmer lobby is pretty powerful.

Yesterday, I was with a friend who has had a close look at the Mandi mafia at work. What he told me was frightening. I bet any doubt I had vanished. Of course BJP with the small traders lobby as their core strength have to posture.

As for Indian chains like Reliance they do not yet have the expertise to set up the back end. Also, in UP they started with Reliance Fresh in Lucknow (and Kanpur) but Mayawati's goons sent them packing. In addition to the Walmarts, you also have the TESCOs and Carrefours. I have heard no noise about them. Investment in cold chains etc. will be massive. Even Amul accept that they have not been able to establish a really good cold chain for milk so the milk we get is not as fresh as it could be. If Amul cannot after so many years, forget the rest.
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Old 26th September 2012, 15:05   #143
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

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Nuclear deal benefits will be the setting up of nuclear plants in india which is atleast a 4 year project .


Seeing the events unfold at Koodankulam, I feel no new nuclear power plant will ever be set up anywhere in India again. I think the US of A shot itself in it's own foot.
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Old 26th September 2012, 15:12   #144
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

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If Amul cannot after so many years, forget the rest.
Slightly off topic, but decided to share. Moderators may delete if needed
Milk cold chain is the worst of all. I have interacted with some communities that provide milk to the local milk federation. Milk collection happens twice from each farmer. Once at 8 in the morn and once at 5 in the evening. If the cow gives milk at 9 AM, the farmer has no nearby cold storage. A lump of cheap subsidized urea is put into the milk and nicely mixed. Urea is a good preservative and make the milk look rich. The equipment used to test the milk during collection do not work most of the time. The milk federation has not invested anything in establishing cold storage facilities in small villages.
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Old 26th September 2012, 15:24   #145
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Originally Posted by Gansan



Seeing the events unfold at Koodankulam, I feel no new nuclear power plant will ever be set up anywhere in India again. I think the US of A shot itself in it's own foot.
Nuclear energy is not the ultimate answer to our power problem. Its expected to supply 20 % of our power energy at peak capacity. Peak capacity building will take 2 decades atleast! Then is the political will of states to consider. States will eventually come around as they have no money to build any infrastructure!
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Old 1st October 2012, 12:59   #146
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Spice/Go and KF will gain quite a bit if some big airline invests in them.
What is in it for big international airlines. Well India is bang in the crossroads of all the east west traffic. Also it has a lot of originating and terminating traffic. If we look at airbus/boeing prediction, they predict a minimum of 1000 aircraft needed by 2030 to just handle Indian traffic. Almost 50% of Emirates traffic either originates, transits or terminates in India!! and KF if nothing holds rights to most of the lucarative sectors and routes, this is of primary interest to investors.
Well looks like the much vaunted FDI in aviation has done zilch for KF. They have a staggering debt of $1.2 billion and all this cheer leading for FDI in aviation seems to have been an opportunity for some of the bigger stock holders to dump KF stock and recoup whatever investment they made . Case in point the KF stocks were trading at Rs 7 on Aug 13 and then lo and behold the announcement from Dr. Singh had everybody cheering. KF share price soared to Rs 17 till end of last week just on the speculation that fools are going to rush in. Till the lender consortium led by SBI pricked that balloon last Friday by rejecting any more operational borrowings and asking it to present a get well plan first (which I think Mr. Mallya doesn't have given his KF calendar commitments). Today they canceled a lot of flights. I think the civil aviation minister has now warned that KF's licence will be canceled if their no. of operating aircraft fell below 5. Are you kidding me? Are they only running 5 airplanes for their entire operations ?

Oh well. So no business entity will come and rescue this totally troubled sector specially an airlines like KF. Some of the media houses tried to plant some news about Emirates showing interest in KF but in reality Emirates had only generalizations to offer like this.

Quote:
In response to a query on the airlines' interest in Kingfisher, an Emirates spokesperson said: "India was one of the world's most important aviation markets. While Emirates' philosophy is to focus on organic growth, we always welcome any reform which liberalizes markets, including FDI rules." He refused to comment on specific queries pertaining to talks with the Indian carrier.
Source: http://timesofindia.indiatimes.com/b...w/16582433.cms

or like this.

Quote:
Dubai's flagship carrier Emirates said on Monday it did not have plans to buy a stake in any Indian carrier, after India last week allowed foreign airlines to buy up to a 49 percent stake in local carriers.
Source: http://economictimes.indiatimes.com/...w/16432243.cms

Why would anybody in the right sense commit to the massive debt of KF while there is no clear vision of how to recoup that debt and make profits? In fact Emirates has said that they would only be interested if KF can work out a debt deal with its lenders. If one were to parse that in real terms, it means if KF can get their lenders to write off their debts. Remember the majority of KF's lenders are PSU banks and if they write off those debts all it would mean is the tax payer is funding KF. That write off would eventually show up as a deficit in the government's balance sheet. So FDI in airlines was supposed to reduce the deficit or increase it? Or was it about giving KF one last opportunity for survival by falsely believing that Emirates would come and do some charity work? Or more importantly was it used to really take the nation's eyeballs off the massive swindling that happened in Coalgate? Seriously even after over 2 weeks have passed I am yet to hear any concrete proposal/plan from aviation players involving FDI. I think I read only something about Spice but perhaps that too was very insignificant and has not received much play at all.
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Old 1st October 2012, 14:05   #147
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

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Seeing the events unfold at Koodankulam, I feel no new nuclear power plant will ever be set up anywhere in India again. I think the US of A shot itself in it's own foot.
As one who has spent over five years working on and around reactors I think I may be a bit better qualified to comment than most.

First of all we need energy. Now what are the real options, fossil, hydro or nuclear. Fossil will give a massive carbon footprint. Also, as it stands they are unable to produce anywhere their true capacity for want of coal. Hydro is clean, but then there is one issue. In case of rain failure we need even more power which the hydro are discounted for.

Nuclear remains the only real option - France has the bulk of its power from Nuclear. Nuclear power is safer than the options. I am fairly sure that a lot of the protests are paid for by the US and Germans. US is a case of sour grapes, they have nothing over 1000MW and their plant design is old. Germans have a lot of low cost Russian gas so can afford to shun nuclear power. Even they are having second thoughts about the accelerated schedule announced by the govt. This is being rolled back.

Also, ill informed media plays its role, I am sure 95% of the anchors do not know the difference between Uranium & Plutonium or Normal and Fast Breeder, or Light and Heavy Water reactors.

I will rather live next to Douneray (the British power reactor research facility) than next to Union Carbide, Bhopal, or Sevaso or Flixborough.

No industry is 100% safe (nor is crossing a road) but overall the Nuclear industry is far safer than most chemical industry.
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Old 1st October 2012, 14:14   #148
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^^I think the USA wanted to throw a spanner in the works through Chrisitian front groups, since what is coming up is a Russian reactor and there is an agreement for two more in the same location. Unfortunately Fukushima happened in the midst of the furore, creating undue fear among the local people, which was fanned by vested interests. Now the chickens are coming home to roost for the US. None of the proposed nuclear sites anywhere in India will take off in future, without the Govt having to fight every inch of the way.

Last edited by Gansan : 1st October 2012 at 14:16.
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Old 1st October 2012, 18:04   #149
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

For me, if FDI in retail is good or bad, I don't know but what I do know that

Local kirana stores sells mix of local and branded products.
They sell adultarated items
They don't provide bills thus I am damn sure they are not paying taxes to Government either.
Farmers have no choice but to sell their products in local mandi market which operates as mafia.

What if FDI is implemented.

Local farmers will have choice to sell their products whenever they get high price (Be it local mandi or directly to the big retailers)
Customers have choice to buy product whenever they find cheap and good quality (Be it local kirana shops or these big outlets.
Government will get taxes.
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Old 1st October 2012, 18:08   #150
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Default Re: Foreign Direct Investment in the retail sector. Good or bad?

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^^I think the USA wanted to throw a spanner in the works through Chrisitian front groups, since what is coming up is a Russian reactor and there is an agreement for two more in the same location.
That's what the minister of PMO has been parroting for a long time but has shunned away from naming anyone specifically. The issue for the activists and local populace is the secrecy around the plant and the protection of the Russian Operator form the liabilities act. If Kudankulam is USA's instigation who is behind the Jaitapur agitation which is a French plant?
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