As per newspapers reports, US based giant Walmart is buying controlling stakes in Flipkart Pvt. Ltd. and will steer its Singapore and India based subsidiaries. There is general consensus in the country that FDI in multi-brand retail will not only kill entrepreneurship, and is anti-farmers and will kill job creation opportunities in the country & rightly this is kept out. But strangely, Walmart is using the e-commerce route to circumvent the rules to attack Indian market. It is to be noted that nowhere in the world, Walmart has a Market Place Model.
We know from the experience of other countries that wherever such domestic companies existed, they all sold out to bigger MNCs. All over the world, giants like Walmart and Cosco have taken over. This deal is unfortunate, but not surprising. Now the danger is knocking at our doors, these developments force us to raise our voice, and appraise people of various disruptions it will do to the market and violations of the law of the land, along with being unethical and against the national interests.
Via Flipkart this is not only a backdoor entry, but Walmart is barging into the Indian market. This will further eliminate the small and medium businesses, small shops, and opportunity to create more jobs. Most of these small entrepreneurs are already battling for their existence, entry of Walmart will further create problems for them.
Interests of those at the bottom of the pyramid are needed to be safeguarded. Walmart is the world’s largest importer of Chinese goods –after top six countries, they are seventh – they will continue to pump in these products, killing our small and medium enterprises further and kill our ‘Make in India’ dream too. We all know that they have interests in the multi-brand retail of food and combination of both will kill the interests of farmers.
The Indian farmers are in process of getting trained to deal with Farmer Producers Organinsations, it will still take time to make him understand the value of his produce and negotiation skills to deal with the MNCs. Unleash of Walmart, will destroy their space. Government has been trying to double farmers’ incomes. These MNCs will not only bind our farmers, but will also kill their appetite to experiment new crops and newer markets.
We are committed to the scenario that farmer must not only earn more, but is independent to sell his produce. This scenario will take India to an ultimate situation of food security. This deal is counterproductive to achieve this. We will again make more farmers dependent on the designs of MNCs. Certainly, this is not in our national interests.
India is strategically opposing the discussion on e-commerce in World Trade Organization, or WTO. and we support the decision. The biggest reason behind opting for this strategy is, we need to strengthen our laws and regulations, so that Indian interests could be best protected. But this entry of Walmart, will defeat our purpose. At present, the absence of watchdog, regulator, ombudsman and the connivance of certain bureaucrats, allowed many of the violations to become a norm. There are no rules set for the B2B trade via e-commerce, so there is no check and balance. In absence of rules and regulations, companies such as Flipkart India Pvt. Ltd, Myntra Jabong India Pvt. Ltd and companies of similar nature should not be allowed to raise any funds directly or indirectly from existing or new investors.
The illusion is that Wall-Mart will sell the product on lower price to the common customer, but Wal-Mart will buy goods from the manufacturer on its own terms and condition & sell the product on high price. In this context, the manufacturer will dependable on the Wal-Mart & consumer will not get the best price for the product.
Akhil Bharatiya Grahak Panchayat is working for the Consumer awareness but National Interest is our highest priority and we believe that the far reaching consequences of this purchase will be very serious effect in financial context of the nation & also against the Consumer interest.
– Narayan Bhai Shah
National President, Akhil Bharatiya Grahak Panchayat
Courtesy: VSK Bharat