An analysis of Retail Market with respect to FDI in India

Like every other Economy, the retail sector is also one of the crucial and the most potential sector of the Indian economy. Retailing is the interface between the producer and the consumer purchasing for personal utilization. This prohibits immediate interface between the producers and consumers. A retailer is one who stocks the manufacturers' products and is involved in the selling of these products to the individual buyer, for earning a profit. As being what is indicated, retailing is the last connection that unites the individual consumer with the producers and distribution chain. FDI is a direct investment into production or business in a country by a company in another country, either by buying a company in the target country by expanding operations of an existing business in that country. The Government has relaxed significantly the norms for FDI in several sectors including the critical Defence sector. Earlier the Government had planned opening the markets for the retail segment only vis-à-vis the foreign direct investment. According to study conducted by ICRIER, total retail business in India will grow at 13% annually, from US $322 billion in 2006-07 to US $590 billion in 2011-12 and further US $1 trillion by 2016-17.