Why FDI is not feasible at this point

 Why FDI is not feasible at this point

By Gopal Krishna Agarwal,

Inviting foreign direct investment is not the issue, but we need to look at the context of the entire move. FDI at this juncture does not fit the bill as India has a number of domestic issues to tackle. We need to look deeper to understand how and when the investments can really prove fruitful for agriculture and the manufacturing sector. The political and economic conditions of our country in the current scenario also need to be taken into consideration.

The government has launched a campaign to show us the merits of their move, but that's not enough be- cause it requires proof, which they are yet to produce. When they talk about quality assurance in terms of consumer satisfaction, they also need to project the cost-benefit analysis. For us, isolated product avail- ability is not sufficient. At the end of it, people want to know how many products really benefit them.

The government quotes examples of countries like China and Indonesia, wherein despite no caps on FDIs, the local retailers are flourishing But a reality check shows that China has become the hands of foreigners. The locals may be paid well, but their ownership has been bartered for the price they are paid. The owners have become em- ployees in the hands of foreigners. Do we want the same to happen to India?

Then, what about procurement? The government needs to give a clear picture of where are these firms going to procure the raw material from. Agricultural procurements in the US and Europe are procured at subsidies, and as for China, it procures subsidised raw material for its manufacturing. So that is one point where we need clarity.

There are many more such questions, which have raised doubts in the minds of all. How many companies does India open its market to If it is just the major ones such as Wal-Mart, Carrefour and Tes- co, then it is surely going to kill the market by shutting all doors to competition. And it would be significant to point out the Competition Commission of India is not as functional as it should be. That's the context being spoken about.

It is our domestic problems which provide a background to the opposition to foreign investments Reports say the net foreign exchange for India is negative. Thus, the government needs to explain how we can turn it around for our benefit and make it positive.

The Indian real estate boom, with its rampant corruption, is not hidden from anyone. So how does the government plan to solve the problem of exorbitant property prices, which scares the domestic investors away? As has been said earlier, India needs to look within and fix its problems first instead of looking out for foreign help.

Chinese owners have become employees nothing but a puppet in in the hands of foreigners. Do we want the same to happen to India?