In the last week, some Bangalore-based newspapers reported on page three the opposition by local traders to the operations of Metro, the German giant in the retail trade, including agricultural produce. That news item also looked like an afterthought, for filling the space after covering the escapades of noisy and vulgar celebrities. The English language media, which shouts on a daily basis from roof-top about the “cherished press freedom,” does not bother about a profound and far reaching issue, which is going to affect millions of Indians in terms of employment, culture and way of living.
From Manmohan Singh to Jaswant Singh (in between Chidambaram and Sinha), every FM has categorily stated in the Parliament that there is no move to introduce FDI in retail trade. As usual, there are some ill-informed editorials by semi-literate editors in some of the business papers about the need for FDI in retail trade (along with all activities including maintenance of toilets, but excluding in print media, since that will be against their “cherished press freedom”). It is another issue that, for a crumpled silk tie or a bottle of IMFL, one could get prominent space in the editorial pages in some of these business papers.
Unfortunately, there is not much debate (leave alone informed debate) even among the academicians and policy-makers about the far-reaching implications of the arrival of a global retailer like Metro.
Role of Trade in our Economy
Trade constitutes a very important segment of our economy with a 13% share in GDP during 2000-2001. In other words, in the aggregate GDP of Rs. 19 lakh crore during that year, trade was of the order of Rs 2.5 lakh crore. This is comparable to the 16% share of manufacturing in the same period. Agriculture constitutes nearly 25% of the share of GDP. (National Accounts Statistics, CSO, New Delhi-2002)
We also find (Table-1) that the share of the service sector is nearly 50% of the economy during 2000-01 and it is the...