This presentation discusses potential challenges with foreign direct investment (FDI) in India. It argues that India does not need foreign funds based on historical examples of high returns on domestic investments. It questions the government's decision to open the retail sector to foreign brands. It expresses concerns that the benefits of FDI will not reach ordinary citizens and farmers due to issues like corruption. It contends that India's laws are not strong enough to ensure FDI benefits the people and protects domestic businesses. The presentation concludes by recommending that any FDI in retail be conditional on purchasing a majority of products from Indian farmers and businesses.

1. Presentation on FDI Challenges
In India
Presented By;
C.P Praveen Kumar

2. Potential dangers associated with FDI.
Majority of FDI has come in the form of
speculative investments in India's stock
market, where few have seen phenomenal
jumps in their stock prices, while stocks of
some major Indian manufacturing companies
have languished at very low valuations.
Greater instability in India's financial markets.

3. • History of foreign direct investment in India indicates
that India does not need any foreign funds.
• In past history when companies invested Rs. 10 Lakh in
one year they made profits of 50 Lakhs or 1 Crore.
• Now Question is why Indian Government is opening
the Retail sector for foreign brands?
• After 50 Years what will happen in India because of
Foreign Direct Policy in Retail?

4. • Big Malls and Big retail chains are good for any honest
Country but in corrupt nations the benefits do not reach to
the poor people.
• The benefits of such faulty FDI policy are enjoyed by
Politicians, big business houses, rich people and their
friends who introduce the laws for their citizens.
• India does not have good and excellent laws like USA and
China.
• Foreign direct investment is good for the India but reality is
that Indian laws are not ready for the FDI investment

5. One example –
• In USA if any American citizen hides his money in other country the FBI
and IRS of USA see that that rich American Citizen goes to Jail.
• On the other hand Indian Government and laws do not even allow the
Indian citizens to know the names of corrupt India who has kept the
money in other countries.
• The Government knows the names but we Indians do not have right to
know the names of Corrupt Rich Indians.
• Those corrupt Indians do not go to jail but they pay minimal fine and their
money becomes legal.

6. Example of China –
China – If you are involved in corruption. If you are
found doing corruption in China, Chinese government
gives the corrupt person a death punishment
immediately.
Like this laws are very strict.
What happens in India?
we know it…
nothing happens they get the bail and never go to Jail
again in their prime youth.

7. Before we talk about FDI one has to understand
the complete structure and working of Indian
Government and Indian system:
2G was happening and No Government agency
tried to stop the 2G.
Major scams and crimes come out in public
domain or knowledge in India because of
Supreme Court of India and few people or NGO
who dare to file Public Interest Litigation writs in
High Courts or Supreme Court of India

8. Current Policy
• As per the current regulatory regime or say Policy
Foreign Direct Investment (FDI) up to 51% is allowed with
prior Government approval, in retail trade of ‘Single Brand’
products. Guidelines notified, vide Press Note 3 (2006
Series), require:
i. Products to be sold should be of a ‘Single Brand’ only.
ii. Products should be sold under the same brand
internationally.
iii. ‘Single Brand’ product-retailing would cover only
products which are branded during manufacturing.

9. • Meaning of Single Brand in connection with
FDI?
Single Brand means a retail store with foreign
investment which can sell only one brand.

10. The retail industry is divided into:
1. organized sectors – The sector which pays income taxes, sales tax etc or
licensed retailers or hypermarkets and retail chains
2. unorganized sectors – this sector includes local Kirana Shops or hand
cart vendors or pavement vendors
Unorganized sector needs the help of Government of India but problem is
in last 64 Years India failed to give them facitlies.
Indian government does not have storage facilities to keep the extra food
produced by farmers.

11. Current Indian Scenario
• Currently in India majority Kirana shop business is family oriented.
• Current situation is, farmers do all the hard work and they enjoy the
minimum or lowest share of the profits.
• Middle men that is Dalals or agents earn more than farmers.
• Farmers commits suicide as they can not give education or food to
their kids.
• Ever heard any agent committed suicide for the above reasons.
• If farmer commits suicide no one pays attention but when rich air line
say we are suffering losses immediately top politicians say that we will
bailout.

12. • Currently if the FDI comes into India only and only rich people
of India and politicians will benefit.
• No Indian Consumer will benefit.
• No Farmer will benefit.
• In India laws are made for the benefit of Rich and not for the
benefit of poor.
• Here corruption has become a religion for many people.

13. • American farmers are not rich they are surviving on the
subsidies given by the American government.
America government gave a subsidy of US $ 307 billion
under the US Farm Bill 2008 to farmers it’s for 5 years.
As per studies in Europe also the subsidies given by
Government to farm sectors are increasing.
President Barack Obama in his speeches he said to
American citizens that start to purchase from the local
stores.

14. • When FDI comes to India it may or may not
eliminate middlemen but the profits of middle
men will not go towards the farmers or
consumers that profit goes to politicians and
company owners.
• India has signed the GATT agreement thus Indian
government has no right to tell the big retail
companies from where to purchase.

15. • In study entitled “Wal-Mart and Poverty”, Pennsylvania State
University in the United States has clearly brought out that those
American states that had more Wal-Mart stores in 1987, had higher
poverty rates by 1999 than the states where fewer stores were set
up.
Wal – Mart USA turn over = US $ 400 Billion = Jobs created =
employs 2.1 million people.
Now in India Indian retail sector too has a turnover of US $ 400
billion, but has 12 million shops and employs 44 million people.
So who is creating more Jobs ?
• FDI will not create jobs FDI will fill the bank accounts of Politicians
and Rich Indians.

16. • Wal-Mart Stores, the world’s biggest multi-brand retail chain, had
told the US Senate that it had lobbied for “discussions related to
India’s Foreign Direct Investment (FDI).”
Wal-Mart spent Rs. 52 Crore between 2007-2009 towards FDI in
India or say getting entry into the India.
The company had also incurred Rs 6-crore in the first 3 months of
2010 for the same purpose.
It has disclosed “discussion related to India FDI (Foreign Direct
Investment)” as one of the issues in its lobbying with the US
lawmakers in the first two quarters of 2011, during which it spent
nearly USD 4 million.
Hourly Salary of the Wal – Mart CEO Michael Duke's is $16,826.92.

17. Conclusion
• We like it or not thus in our hands we got only one thing to see that
FDI does not come into India and if it comes into India,
It comes with the good laws which will protect the Indian
Consumers and Farmers.
Good Law - Any Company can invest 100% in retail but it will be
mandatory for that company to purchase 60% farm produce from
Indian farmers or producers or manufactures.
Before allowing FDI Indian government needs to study in
transparent manner not behind close doors the benefits of FDI.

18. • Big corporations will not be allowed to import
any food items from other nations.
• Big Kirana shops must and compulsorily buy
everything in India and sell in India or they can
export it.
But they should be banned to import from
other nations.

19. Thank You….