Shop Owners Protest India Retail Reform

Posted December 1st, 2011 at 8:25 am (UTC-5)
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Shopkeepers around India have gone on strike to protest the government’s decision to allow foreign retailers into the country.

The strike Thursday closed markets in New Delhi, Kolkata and other cities, as small shop owners protested the policy they say will force them out of business.

Activists from the opposition Bharatiya Janata Party, which is supporting the strike, burned effigies of Prime Minister Manmohan Singh.

The Indian Cabinet approved a measure last week which would let global firms own up to 51 percent of so-called multi-brand retail companies in India, such as supermarkets. Foreign companies could also own up to 100 percent of stores that sell just one brand of a product.

The issue has brought parliament to a halt as opposition lawmakers demand the government reverse the decision.

Mr. Singh says the reforms will go forward, and will both bring down food costs and create jobs.


The new foreign-owned stores would be allowed in cities with a population of at least 1 million. The retailers must invest at least $100 million in the cities. Food retailers would also be required to buy 30 percent of their produce from small and medium enterprises.

Global retail giants, including U.S.-based Wal-Mart and France’s Carrefour, have waited for years for India to open up its $450-billion domestic retail market, which is dominated by family-run stores.

India’s retail sector is the country’s second biggest employer after agriculture.