The least the Budget can do is set a time frame and an action mechanism to address the issues pertaining to its legitimate growth as an Industry of the future
A recent report on Indian Retail traces the history of organised retail in India as being spread over 4 phases, and identifies the period from 2010 as the fourth and Consolidation phase. Whether there will be more phases or more stutters in the growth of organised retail remains to be seen, but what is certain is that the government has the biggest hand to play in the making or breaking of Organised Retail in India. And the eagerly anticipated 2010-11 Budget (to be presented on February 26, 2010) will have ample opportunity for setting the tone right for the next 5 years, just like the historic budgets in the early 90s liberalised the Indian economy.
The reasons for this great dependence on policy, over demand and markets, are both financial and regulatory. The financial reasons are well known: the possible boom in foreign direct investment (FDI) when retail sector is opened up, the entry of global brands that would bring best products and services given our growing demographic attractiveness, and the possible effects on local employment, sourcing and allied services. Little can be expected however, in this budget, in terms of loosening of the FDI reins, as this change would need more political courage & conviction (which is lacking till date) and more time for formulating the ground rules to address the fears in various domestic quarters.
But what is more critical than even the above would be the symbolic change that can be brought within the regulatory function of the government. Organised Retail does not have the status of an “Industry” like the banking and financial circles, because of the lack of regulation and clarity within the government on Emerging Retail. What the retailers would be keen to see would be an official acknowledgement of the role that Organised Retail would play in the next decade or more, and a policy statement governing the vision of the government in making this happen.
The reasons for this great dependence on policy, over demand and markets, are both financial and regulatory. The financial reasons are well known: the possible boom in foreign direct investment (FDI) when retail sector is opened up, the entry of global brands that would bring best products and services given our growing demographic attractiveness, and the possible effects on local employment, sourcing and allied services. Little can be expected however, in this budget, in terms of loosening of the FDI reins, as this change would need more political courage & conviction (which is lacking till date) and more time for formulating the ground rules to address the fears in various domestic quarters.
But what is more critical than even the above would be the symbolic change that can be brought within the regulatory function of the government. Organised Retail does not have the status of an “Industry” like the banking and financial circles, because of the lack of regulation and clarity within the government on Emerging Retail. What the retailers would be keen to see would be an official acknowledgement of the role that Organised Retail would play in the next decade or more, and a policy statement governing the vision of the government in making this happen.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Prof. Rajita Chaudhuri's Website
domain-b.com : IIPM ranked ahead of IIMs
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IIPM's Management Consulting Arm-Planman Consulting
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IIPM: Indian Institute of Planning and Management
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An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Prof. Rajita Chaudhuri's Website
domain-b.com : IIPM ranked ahead of IIMs
Arindam Chaudhuri's Portfolio - he is at his candid best by Society Magazine
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
IIPM B-School Detail
