Under new regulations, retail giants like Wal-Mart, Carrefour and Tesco, long prevented from selling directly to consumers, Indians will now be allowed to own a share of 51% majority in joint operations with a local partner. Resellers of so-called flagship, the likes of Apple and Ikea, can own 100% of their stores, up from 51 percent earlier. Both types of shops will have almost a third of their goods from small and medium-sized suppliers of Indian origin and to confine their operations to 53-odd town with a population of over one million.
After almost a decade to discuss the issue threadbare on op-ed pages and in TV studios, Indians should now recognize the economic benefits of foreign direct investment in retail. Large foreign retailers will reduce waste by creating modern cold storage and supply chain for fruits and vegetables. They will increase choice and lower prices by cutting out the middlemen who often gouge consumers with charged above the global average. Commerce and industry Anand Sharma Minister predicts fresh investments to create 10 million new jobs in three years, about 5-6 million of them in the logistics alone.
Against this background, the average resident of New York, Shanghai and Jakarta might wonder what all the fuss is about. Why should they care if their TVs Indians and tomatoes come from a shop owned by a German or a Gujarati?
The answer is that India's economy may have progressed over the past 20 years, but much of its political class remains rooted in ideas failed in the past. See the poor as victims of capitalism, rather than as his biggest potential beneficiaries. Foreign profits are synonyms of booty rather than with the creation of wealth that benefits everyone. And rather than evolve a bipartisan consensus on economic issues, many Indian leaders prefer theatricality devoid of fact, threats of lawlessness and unrest of the crowd.
A sampling of opposition to capture retail opening this neatly. In Uttar Pradesh, Uma Bharti, a senior leader of the opposition Bharatiya Janata Party (BJP), threatened to "give focus to the first Walmart store every time it opens." His colleague Sushma Swaraj has been busy tweeting up a storm of misinformation about how Walmart allegedly ruined the American economy. Not to be outdone, L.K. Advani party stalwart has temporarily dropped a quixotic quest to repatriate wealth held by Indians abroad to focus instead on more pressing task of saving the Indian sovereignty from the dangers of cheap cauliflower and t-shirts.
BJP's response threatens to cement its reputation as a party of little minds and mean-spirited resentments. But it is hardly alone in his indignation. Uttar Pradesh Chief Minister Mayawati, perhaps best known for the use of taxpayer rupees to dot his State with statues of herself, dubbed the move "anti-people" and warned that it would benefit foreign companies at the expense of India. Striking a note, Tamil Nadu Chief Minister j. Jayalalithaa, a former actress, called the decision "a rude shock to thunderstruck million traditional retailers in the country." The Chief Minister of Bihar and Paschimbanga (formerly West Bengal) seem to share these fears.
To be sure, a political vocabulary — and the wrong exceeded views represents — it explains everything. Fears that foreigners more efficient will hurt local shopkeepers and the desire of old-style politics an impopular batter with a problem of populist do their part. But opposition by interest groups and politicians enter politics parish over politics are impediments that pop up in practically every democracy. What fashion aside India is the monopoly of the left his economic thinking politicians, including seemingly in a party of center-right, as the BJP. The emerging middle class need to shake off this leftism is pilot country towards prosperity.
In this sense, the debate about Walmart in India goes far beyond shopping and supply chains by Indian democracy can spew the kind of leaders that the country needs to be competitive in the 21st century. If India is to flourish, needs more politicians who see clearly that even 20
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