How FDI in retail affects Britain's small traders

London: As India's guess work continues over how will Foreign Direct Investment (FDI) in retail affect small traders, Britain, in some ways, provides a model for what may happen, with several small retailers going under, but many others surviving and even flourishing.

CB Patel runs some newspapers that are the voice of small businesses. He himself has been a retail businessman. When asked about the impact of the invasion of big retail, the editor of 'Asian Voice' said, "Yes, it has affected corner shops, we sold them out. But there are many shops and intelligent hardworking shops that are doing very well. I had ten shops, four are doing fantastic business, and the supermarkets are not very far, but six are just about surviving."

The contentious issue of FDI in retail has virtually washed out the winter session of Parliament so far in India, with the Opposition and even the government's allies ganging up demanding that the government withdraws retail FDI. Those who are for throwing open the retail sector to big giants argue about how the consumer will benefit. But the fear is that the giants may swallow up the corner shops.

Alex Jackman, senior policy adviser, Forum of Private Business, said, "Obviously there is huge purchasing power with supermarkets and the economies of scale they can achieve to keep prices down for the consumer is something that small, independent retailers simply can't match."

Explaining the problems small traders face, a shop owner Raj said, "In this shop, earlier I had seven to eight people, now we have only three because we cannot afford the wages. Supermarkets make things very hard for us."

What is happening to a lot of corner shops in Britain could happen to a lot of kirana shops in India. Despite the many gains from opening up retail, if the experience in Britain is anything to go by, a lot of people in retail will face very difficult days ahead.

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