Research Paper On Fdi In Service Sector

In 2013, the market value of the Indian retail sector was the US $500 billion and is considered to be one of the top five retail markets with a population of 40 million engaged in it.

The retail sector is expanding at a rapid pace, with a gradual shift in formats towards organised retailing.

Therefore, it led to the initiation of competitiveness among domestic enterprises through access to global formats, retail innovation, availability of goods to the consumers and increasing technology and management practices.

The liberalisation of the retail sector to universal competition is likely to motivate retail rush and to transform retailing landscape and country’s ailing infrastructure in India.

In the contemporary markets economies, retailing is a significant link between producers and consumers.

In order to build a strong relationship between the two, retailers not only offer a wide range of products, but also provide complementary services to the consumers, both of which together provides satisfactory and convenience experience of shopping for consumers.

Further, the development of scale was also limited due to restriction on interstate movement of goods and stock.

Overall the growth of retail sector was constrained due to low income of the consumers followed by high taxation and poor government support.

Slow growth was due to high taxation rate and rigid licensing policies on imported goods discouraging foreign investors towards consumer goods industry.

The benefit towards economies of scale was affected due to lack of wide variety of products.


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