New Delhi: Foreign direct investment in the fast-growing retail sector will "significantly" boost hiring activities and has the potential to create about 80 lakh jobs in the country, predict experts.
On November 24, the government allowed 51 per cent FDI in the multi-brand retail, paving way for global chains like WalMart, Carrefour and Tesco to open mega stores. It also removed the 51 per cent cap on FDI in single brand format.
Though corporate India hailed the decision, there has been a deadlock in the Parliament on the FDI issue, with allies Trinamool Congress and DMK also voicing opposition to permitting FDI in multi-brand retail.
“Retail industry had been waiting for FDI clearance from the government for a long time. The decision to raise FDI limits (in single brand retail) will act as a life-saving drug and is a big boost to the industry,” executive search firm GlobalHunt Director Sunil Goel said.
“If all goes well across the level, the country should be able to create 60 to 80 lakh jobs,” Goel added. Some experts refrained from quantifying the number of job opportunities owing to opening up of the retail sector, as details such as the number of players who will come in, is not yet clear.
But they were unanimous on the fact that there will be “substantial” job creation. “If FDI in retail is implemented, a lot of organised players will be coming in and we would see an increase in employment opportunities in the retail sector and associated sectors like sourcing and logistics,” staffing solutions provider TeamLease Services Managing Director Ashok Reddy said.
Ma Foi Randstad’s MD and CEO E Balaji also believes that FDI in retail will give a big boost to hiring activities in India. “Once FDI in retail is implemented, a lot of MNCs will come and bring along their own practices and policies,” Balaji said. He cited the example of US-based Walmart, which alone employees close to 1.8 million people. The Centre has decided to put a hold on the controversial FDI decision, in an apparent bid to break the Parliament logjam. Experts, however, said that all the jobs will not happen in the very first year itself and that it will be in a phased manner. Cumulatively, however, it will be a fairly substantial number. The growth in retail sector will first be seen in Tier 1 cities and would gradually extend to the Tier 2 and Tier 3 towns, experts said.
“Since retailers will take some time to establish their network and infrastructure in the new towns they venture into, the prospect of job creation will increase over time,” recruitment process outsourcing firm Elixir Consulting Executive Director Richie Madan said.
The general perception is that retail is only restricted to certain areas, but there is a greater potential of retail in pharma, healthcare services, agro-business and service sector, experts added.
Comments
0 comment