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On an average, the retail sector in India has been growing at 7% per annum (based on 1999-2002 figures). Retail sector in India is predominantly unorganised, having one of the highest density of retail outlets per capita in the world and lowest per capita retail space. Only 2% of the Indian retail sector is organised while this has been 20%, 80% and 70% in case of China, United States of America (USA) and United Kingdom (UK) respectively. The contribution of the Indian retail sector to the total employment has been 7% as compared to 6%, 11.7% and 11% in case of china, USA and UK respectively. As per the existing policy of the government, foreign direct investment (FDI) is not allowed in retail trade in any form whereas this has been allowed in many other countries with or without restrictions. This was stated by Shri Kamal Nath, Union Minister of Commerce & Industry, in reply to a question in the Rajya Sabha today.
As per study commissioned to Indian Council for Research on International Relations (ICRIER) by the Department of Consumer Affairs, the size of Indian retail market has been estimated as Rs.7,40,000 crore in 2002.
Facts relating to global retail market are as follows:
Ø Retailing is one of the biggest private industries in the world and total sales exceeded US $ 8 trillion in 2002.
Ø It accounts more than 10% of GDP in western countries and India and 8% in China.
Ø High incidence of female employment and part time employment.
Ø Food and grocery constitute the largest segment of retailing
Ø Rapid urbanization, income growth, increased participation of women in labour force and improvements in infrastructure in 1980s and 1990s led to organised retailing.
Ø Most countries liberalised policies for opening of FDI in retailing.
Ø FDI allowed in China (1992), Brazil, Mexico, Argentina (1994), South Korea (1996), Thailand (1997) and Indonesia (1998).
Ø Total procurement by global retail chains from India is estimated to be below US $ 3 billion out of which 1 billion by Wal-Mart alone.
SB/MRS
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