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Submitted By nikpol243
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1. Title of the paper

“Impact of Multi Brand Foreign Direct Investment in Retail Sector in India (Before the approval)”

2. Author Name – Prof. Nikhil Polke 3. Theme – Retail

4. Institute Name & Address

Tirpude Institute of Management Education 1, Balasaheb Tirpude Marg, Civil Lines, Sadar, NAGPUR – 440 001

5. Email – n.polke@tirpude.edu.in 6. Contact number - +91 99233 80707

Abstract

India has been placed at first position in the category of countries with the best opportunity for investment in the Retail Sector by a survey of A.T. Kearney’s 2005 on Global Retail Development. The increasing disposable incomes among the Indian middle class and increasing young population have been cited as the main reasons for such attractive optimism. This positive opinion of the experts has also encouraged the intense lobbying by certain sections for opening Foreign Direct Investment in this sector. Foreign investors are also very enthusiastic to invest in India’s Retail Sector.

At present India does not allow FDI in multi-brand retail but permits upto 51 percent in single brand retail and 100 percent in cash and carry wholesale trading. There is a ban on FDI in big multi-brand retail stores but there is no restriction on companies accessing the foreign equity market through the American and Global Depository Receipts. The Government of India opened up FDI in ‘Single Brand Retailing’ in the year 2006. This was done with a primary motive of giving a boost to organized retailing in India.

However, there’s another equally strong lobby that has been opposing this idea tooth and nail. They claim that it will mop away the corner shops in every locality and chuck inhabitants out of the jobs and bring unthinkable melancholy. The Government cap over FDI in retail, like in many other sectors, has been essentially a personification of the dilemma that

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