NEW DELHI: Notwithstanding strong opposition to foreign direct investment in multi-brand retail, a Citi report today said the entry of global retailers like Walmart will increase competition in India's organised retail sector.
In addition, USD 15-20 billion in FDI could flow into the country over the next 10 years as a result of the government's decision to allow foreign direct investment (FDI) in multi-brand retail, the report by the global financial services major said.
"The move... will help improve competition in the organised sector through the entry of several players such as Carrefour and Tesco, which have been waiting on the sidelines, and enhance expertise in logistics, supply chain management from multinationals," Citi said in its 'India Microscope' report.
The report also said the move would help enhance the share of organised players in the overall retail sector, who currently account for about 6 per cent of India's USD 470 billion retail market.
Parliament has been paralysed for the last three days as the entire Opposition, joined by UPA allies TrinamoolCongress and DMK, is protesting against the Cabinet decision of November 24 to allow 51 per cent foreign direct investment in multi-brand retail.
Multi-brand retail in India is largely in the unorganised sector dominated by neighbourhood kirana stores and there is a concern among political parties and traders that these stores would be impacted by the entry of global retailers.
Citi's report also asserted that increasing the FDI cap in insurance has the potential to attract about USD 9-10 billion in FDI in the country over the next decade.
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