aapnomics – blocking of retail fdi in india
TRANSCRIPT
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What is FDI?
Foreign Direct Investment(FDI) is when an individualor a company of another country makes a direct
investment into production/ business of another
country. For this, it either buys the target countrys
company or simply expands its existing business inthat country. FDI can also be done through mergers
and acquisitions by acquiring target companys
shares or through joint venture.
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We need FDI for economic growth of a country if that country lacks technicalknow-how and domestic capital . For a developing nation, FDI helps in gettingforeign capital, which is seen as a temporary measure during the developmentof capital markets. It boosts savings and brings additional employment to thecountry.
Why do we need FDI for economic
growth?
2013 Deena Zaidi. All rights reserved.
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FDIs were introduced in 1991under Dr. Manmohan Singhunder Foreign ExchangeManagement Act (FEMA)
Delhi NCR is the single largestretail market in this country
The predecessors of the AamAadmi Party, Delhi CM SheilaDikshit had allowed FDI retailstores to be opened in Delhi,not a single store has beenopened so far.
With the appointment of ArvindKejriwal, AAP blocked FDI retailoutlets in Delhi ,thus, fulfilling itselection manifesto .
FDI IN INDIA
2013 Deena Zaidi. All rights reserved.
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AAPnomicsa boon
or bane?
On 13thJanuary, 2014, the new
government of Aam Aadmi
Party wrote to the Departmentof Industrial Policy and
Promotion that no FDI retail
funded stores would be
allowed in New Delhi
They argue that blocking retailFDI will protect the interests of
farmers and retailers.
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Blocking FDI is not a goodidea!
It seems that AAP has no arguments as to why they haveblocked retail FDI in Delhi.
The decision has not gone down too well with oppositionparties and the industries.
Delhi anyways has not had any FDI retail outlets so far sincemost are located in Noida, Gurgaon and Faridabad.
By blocking Delhi as entry for FDI retail outlets, foreigncompanies will now look at other regions like Mumbai andBangalore for FDIs.
2013 Deena Zaidi. All rights reserved.
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AAP argues that it tends to protect the farmers and jobs of the peopleassociated with the industry. However, it is quite the contrary
By allowing FDI, AAP fails to understand that it will help farmers to bedirectly linked to the retailers. They will not be exploited by the complex
structure of middlemen which pays them much less than what thefarmers deserve.
The direct association of farmers with retailers will make deliveries timely,reduce the wastage of food and bring inflation down by cutting themiddlemensunrealistic margins.
2013 Deena Zaidi. All rights reserved.
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8/13/2019 AAPNOMICS Blocking of Retail FDI in India
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http://www.allbankingsolutions.com/Banking-Tutor/FDI-in-India.htm
http://www.firstpost.com/business/as-aap-blocks-retail-fdi-foreign-retailers-window-into-india-shrinks-further-1337569.html
http://www.ndtv.com/video/player/left-right-centre/aapnomics-making-industry-nervous/305336
http://economictimes.indiatimes.com/opinion/editorial/aap-should-not-ban-supermarket-fdi/articleshow/28810930.cms
http://timesofindia.indiatimes.com/business/india-business/Blocking-retail-FDI-to-rob-India-of-1-crore-jobs/articleshow/28807283.cms?
2013 Deena Zaidi. All rights reserved.