ibnlive » Business

Oct 11, 2007 at 09:40am IST

Maharashtra shuts shop as rage over retail rises

New Delhi: Maharashtra is seeing one of the largest voluntary shutdowns of trade on Wednesday as retail traders, wholesalers and hawkers across the state are protesting the entry of foreign multinationals and Indian corporates into the retail sector.

Traders are also holding a rally in Mumbai with the protests being organised under the banner of the Vyapaar Rozgaar Suraksha Kriti Samiti, a joint action committee representing over 750 trade associations in the state.

During the protest, President of the Traders Association of Mumbai, Mohan Gurnani told CNN-IBN that small-time retailers would be affected by the entry of multinationals.

“Government is permitting FDI in retail. Small traders will be affected as big corporates and MNCs will make the smaller ones go out of business,” Gurnani said.

The protest comes on the back of similar protests in Kerala, Orissa, Jharkhand and Uttar Pradesh where too traders have been protesting against the entry of big retail chains in the past few months.

Incidentally, Reliance Retail, one of the largest retailers in the country has taken a position to close its operations in UP and Orissa.

As per estimates of Federation of Associations of Maharashtra, India has the largest density of retailers in the world with over 1.5 crore retail outlets spread across the country. Whereas in England, only 10 retail chains control 60 per cent of the entire retail market.

According to Gurnani, the government has not learnt lessons from other countries affected by corporate retail.

He said in Thailand, multinational retail chains that entered in 1997 have captured over 10 per cent of the market share impacting 60,000 small retailers. The Thai government had to step in and create a fund to give assistance to them and has imposed zoning restrictions for mega retail shops.

In China, foreign direct investment in retail is highly regulated and many of the stores are allowed to stock only China-made goods, he said.

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