Monday, Nov 24, 2014

Don’t run from big retail, face them, Modi tells traders

Global challenges need not be feared, they must be seen as opportunities Global challenges need not be feared, they must be seen as opportunities:Narendra Modi.
ENS Economic Bureau | New Delhi | Posted: February 27, 2014 4:42 pm | Updated: February 27, 2014 9:56 pm

The BJP’s prime ministerial candidate Narendra Modi Thursday told small traders they have to accept the presence of large retail chains instead of “running away” from the challenges posed by them.

The Gujarat chief minister’s comment is the first clear statement in favour of big retail and e-commerce from the party that has publicly opposed foreign direct investment, especially in multi-brand retail.

While Modi made no mention of foreign direct investment in any of his three speeches in Delhi Thursday, he said his party supports the roll-out of a national Goods and Services tax, a major demand from industry for the next Central government and a key element for big retail to expand.

Modi surprised small traders with his comments at their convention as they have expressed fears that organised retail will swamp them and had expected Modi to highlight those concerns.

Instead, he said small traders must learn to build brands and go online, creating virtual malls to take on large and multinational retailers. “Customers from even small towns are now going for branded stuff. They are going to malls to buy them. Small traders can build a virtual mall by getting into agreements with brands. You can have a virtual mall in small shops at the click of a button,” he said.

Just weeks ago, Rajasthan’s BJP government of Chief Minister Vasundhara Raje became the second state after Delhi to roll back the permission given to foreign direct investment of up to 50 per cent in multi-brand retail. Other BJP ruled states have not permitted such FDI and analysts said Modi’s views could force a rethink.

Modi used the opportunity to deliver three speeches on the same day to provide some indicators of the economic policies the BJP could follow if it came to power. He said India does badly on ease of doing business and added there were too many laws impeding business.
“What we need is a complete overhaul of the departmental system. Laws should be made simple,” he said.

The pace of India’s urbanisation, Modi said, was an opportunity to be tapped. “We should aim for developing more than 50 vibrant cities which will become the driving force for the economy,” he said.

Simultaneously, he said the government ought to improve farm infrastructure which will encourage rural people to stop migrating to cities.
“No one has seen the employment opportunities in the agriculture sector,” Modi said.

 

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