Devil's Advocate: Kamal Nath

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Kamal Nath: I don’t think it’s ever a question of FDI in retail. It’s always a question of big versus small…

Karan Thapar: Can I interrupt? The reason why people make a distinction is because they say look at Wal Mart. It has a turnover of 250 billion it has profits of 10 billion a year. It has 15 times larger than Reliance which is why Kishore Biyani, the Managing Director of the Future Group says, and I quote, “In terms of size, Wal Mart is bigger than the total consumption in India. Once it is able to bring its own equity, it can manipulate the markets on its terms and conditions.’ Does that sort of fear worry you?

Kamal Nath: Well, Wal Mart is of course very large. We have not allowed them in retail…

Karan Thapar: …as yet. And is this the argument for putting them off forever or is it just being careful?

Kamal Nath: I have always said that if FDI in retail, which I believe, will upset the small retailers, we need to strengthen the small retailer. That’s why I said if they want to come in, they should go to the backend. They should invest in packaging, technology…

Karan Thapar: As Bharti is bringing them in?

Kamal Nath: I do not know because Bharti has not filed an application as yet.

Karan Thapar: No, but as per the press reports, they are coming in at the backend, not coming in at the front end. They are not going to be involved in retail they will be involved in cash-and-carry and wholesale.

Kamal Nath: If Wal Mart supplies to every retailer good food products - 40 per cent of which rot - and put up a cold chain, packaging, preservation and supply to every retailer, it strengthens my retailer.

Karan Thapar: Let me point out another thing. Business Line, in April 2005, quoted a series of surveys which suggested that if international retailers were to control 20 per cent of the Indian retail market, eight million jobs could be lost. Now some people say that’s a serious concern, others say ‘where do those facts come from, what are the based upon, they are cooked up.’