ROLE OF FDI IN THE

INDIAN RETAIL SECTOR

MADE BY-
Abhishek
Akhtar
Ashish
Samrat
Vishnu
 What is FDI ?
The Foreign Direct Investment means
cross border investment made by a
resident in one economy in an
enterprise in another economy, with
the objective of establishing a lasting
interest in the investee economy.
 Types of Retailing in India
Single Brand- Single brand implies
that foreign companies would be
allowed to sell goods sold a retail
store with foreign investment can
only sell one brand .(Adidas, Lee,
Nike)
Multi Brand- FDI in Multi Brand retail
implies that a retail store with a
foreign investment can sell multiple
brands under one roof
 Types of Retail Market
Organized - trading activities undertaken
by licensed retailers, that is, those who
are registered for sales tax, income tax,
etc. Eg: Corporate backed hypermarkets.
Unorganized - traditional formats of low-
cost retailing, for example, the local kirana
shops, owner manned general stores,
paan/beedi shops, convenience stores,
hand cart and pavement vendors, etc
FDI in Retail Current Position
FDI is permitted only in single brand
product retailing 100%.
In multi brand 51%
 Impact of FDI in Retail
Sector
1. Consumers access to some of
the major global brands.
2. Improved quality and variety of
products.
3. Increase competition and expand
manufacturing.
4. It gives consumers competitive
advantage.
5. Influences the consumers standard
of living.
 Recent Trends
FDI in specialty stores: Multi-brand organized retail in
specialty stores such as Consumer Electronics,
Footwear, Furniture and Furnishing etc. are expected to
expand and mature in the next few years.(e-zone,
Reliance footprint)
Dominance of unorganized retail: Flexible credit options
and convenient shopping locations may help traditional
retail to continue its dominance in retail sector.
Growth in small cities and towns: Stiff competition and
saturation of urban markets is expected to drive
domestic retail players to tap the potential in small
cities
 Conclusion
FDI provides India with stability in inflow of funds, access to
international markets, export growth, transfer of technology and
skills and improves balance of payments.
More FDI does not necessarily guarantee high growth rates. The
relative emphasis must shift from a broad (scatter shot) approach
to one of targeting specific companies in specific sectors. Socially
responsible FDI should be encouraged through the development of
national and international investment guidelines and regulations.
FDI is beneficial to Indias growth and Indias growth is beneficial
for FDI. India needs to create a talent pool suitable for the
investors and it needs to develop infrastructure that will
encourage the investors. These steps taken by India to bring FDI
will also help India to grow on its own. FDI if monitored and
nurtured in such a way that it will bring more skills and resources
to India will be mutually beneficial
Thank you