Disastrous Consequence of Monopoly Takeover of Retail Trade Must Be

Volume 40 No. 24 Organ of the SOCIALIST UNITY CENTRE OF INDIA August 1, 2007 Founder Editor-in-Chief : COMRADE SHIBDAS GHOSH Price : Rs. 2.00 Disastrous consequence of monopoly takeover of retail trade must be thwarted at any cost India’s vast retail trade business somehow eking out a livelihood by about 96 per cent of which is by running these small retail unorganized retailers, is as big as businesses. A wide scale monopoly $213.33 billion contributing around raid of the sector, rightly 10-11% of India’s GDP and apprehended by one to all, will currently employs over 40 million virtually wipe out these tiny outlets people in about 12 million outlets. rendering millions jobless. Sensing While organized retailing refers to grievous danger posed before their trading activities undertaken by livelihood, the small businessmen licensed retailers including the engaged in retail trade have already corporate-backed hypermarkets and taken to the path of agitation. retail chains, and also the privately Recently at Ranchi, small traders owned large retail businesses, held a protest demonstration before unorganized retailing, on the other five Reliance Fresh Outlets which 5 AUGUST 1923 — 5 AUGUST 1976 hand, refers to the traditional were even ransacked by irate mob. ‘‘...By political power of people I mean developing such formats of low-cost retailing like the In Dhanbad also, small traders are conscious, militant committees comprising the people and the youth local kirana shops, owner manned agitating against opening of retail force in villages and in different areas of towns and cities who can general stores, paan/beedi shops outlets by the Reliance. Not only by themselves tackle all types of work on the basis of the (roadside beetle leaf/cigarette shops) those associated with this small revolutionary mass line using their own brains, and dare to confront most of which are located in less retailing but also the common any situation, who would exercise influence over people not with than 500 square feet (45 sq meters) people at large will be severely force or police help or hooliganism, but on the strength of their own of area, small convenience stores, affected if this sinister design does qualities, capability, personality, thinking and contemplation, their hand cart and pavement vendors, materialize. Hence all right thinking character and organizing capacity, who can correctly discharge their etc. Unorganized retailing is by far people ought to comprehend the responsibility while confronting all adverse situations. ...And you the prevalent form of trade in India grave danger looming large and have to understand that in order to change this capitalist social – constituting 98% of total trade, come forward to squarely confront structure, you will have to build up and develop people’s struggle while organized trade (mega and repulse the move. committees from the village up to the town and city levels — shopping parlours, big departmental people’s committees which will have to ultimately confront the state stores etc.) accounts only for the Chronicle of Monopoly power through struggles. The rallies and processions which are now remaining 2%. The government of penetration organized — we may have to move along this conventional India has now decided to allow big Before we proceed to analyze democratic path for a considerable length of time yet. In particular monopolists, both domestic and the implications of the move, let us situations, we may have to organize satyagraha, and also stage foreign, to enter into this retail have a quick glance at the scheme dharnas. But the whole object is to develop the struggle committees market in a very big way. This has of things being contemplated and through all this which can organize people everywhere — local posed a serious threat to the very slowly implemented by the Indian committees in the localities, district committees at the district level, survival of the owners and government subserving class provincial committees at the provincial level — and conduct the employees of the small retail shops interest of the ruling Indian task, guiding them like a disciplined army...’’ and kirana stores who after not bourgeoisie, an inalienable part of — SHIBDAS GHOSH being able to find any other crisis-ridden, decadent, moribund (Mass Movements and Tasks of the Youth) alternative means of subsistence are Contd. on page 2 Observe Comrade Shibdas Ghosh Memorial Day on 5th August in a befitting manner PAGE TWO AUGUST 1, 2007 PROLETARIAN ERA Monopoly takeover of retail will trigger mass-scale job loss Contd. from page 1 are also finding the retail sector All these monopoly operators primary producers by cutting out world imperialism-capitalism, the extremely attractive. ITC, for will procure the merchandize many layers of middlemen, develop arguments put forth by the power instance, plans to expand its fruit starting from foodgrains, vegetables the processing facilities and export that be in support of the move and and vegetable distribution network and other agricultural produces to the products to meet their global fallout of such step in other by opening 54 new outlets in select products of cottage as well as agro- requirements, farmers and cottage countries. A KPMG survey report metros in the next three years. The based industries and sell to end- industry owners would get better prepared for the FICCI stated that Bharti group of Mittals is consumers through huge network of prices and bigger markets while the organized retail, estimated as a $ 6.4 positioning itself as a player in the dazzling outlets. In other words, consumers would benefit in terms of billion industry in 2006, is projected agri-business sector. It has acquired they with their money power will be lower prices, better quality and to reach $ 23 billion by 2010. With 5,000 acres (2,000 hectares) in establishing control over both greater variety. The resultant rural the organized retail industry in India Punjab to carry out export-oriented sourcing and supply of essential prosperity may open up markets for poised for such an exponential contract farming. It is also planning items including foodstuff. other industrial goods and help a growth, the domestic monopolists a foray into horticulture in West more balanced regional many of whom have been running Bengal. Several formats of Dangling carrot of so-called development as also job creation in big departmental stores and organized retailing like prosperity other sectors. Similar gains would gorgeous shopping malls for quite a hypermarkets, supermarkets and While trying to defend the flow from higher exports when the long time, are now coming in a very discount stores are being set up by proposed move to handover retail global monopoly chains like Wal- big way with the intention of having big business groups besides the trade to domestic and foreign Mart are allowed in other sectors controlling stake in the retail ongoing proliferation of shopping monopoly, the government is such as readymade garments. In business right from raw material malls in the metros and other large advancing the argument that as of their bid to allay the apprehension sourcing to selling to the end cities. now nearly 70 per cent of the value that once monopoly takes over, consumers. The tycoons like Tatas, Not only domestic corporate of agricultural produces is monopolistic pricing practices will Birlas, Ambanis, Mittals and giants, even the foreign big capital expropriated by middlemen brokers set in forcing the producers and Goenkas have already begun to and MNCs are hankering after and hoarders. Once the sector is consumers to sell and buy at the make decisive inroads into the retail Indian retail pie. With the Congress- opened, the private monopoly level stipulated by it, the sector. Ambani-owned $5.6 billion led CPI(M)-backed UPA houses, by being continuously close government spokespersons and worth Reliance Retail Ltd. with its government declaring a year back to local suppliers and customers, other protagonists of the proposal brand ‘Reliance Fresh’ has started that retail sector would be opened would be in a better position to point out that the best safeguard will opening retail shops selling fruits, further for foreign direct investment control and monitor the entire be in the form of permitting all vegetables, groceries, etc. to be (FDI) in a calibrated manner, there supply chain including the global monopoly chains to set up added with Fast Moving Consumer is a bee-line of giant foreign designing of products, the quality of shops so that the competition among Goods (FMCG), pharmaceuticals, retailing companies like Wall-Mart inputs, the manufacturing process, them ensures better prices for footwear, household goods, of US, Tesco, Mother Care, Body the quality of output, the consumers and suppliers alike. consumer durables, etc. at Shop and Debenhams of UK, Metro standardization, labelling and Supporters of FDI in retail also competitive prices in Hyderabad, A G of Germany, Carrefour SA of packaging, transportation, argue that it will bring a new Bangalore and Ranchi. In Calcutta, France and Swoprete Holdings of warehousing, the distribution shopping experience to the growing it has already managed to bag from South Africa as well for making network, changing product mix (that middle class with modern malls and the Municipality the order of forays into Indian retail. UK’s Mark is array or combination of products) complexes all around. renovating big market complexes & Spencer Group and Dubai-based quickly in response to changing seemingly with the objective to Life Style International have already global fashions and establishing the Mode of the fleecing operation convert the same into its exclusive set up shops in India. Metro A G of right kind of captive suppliers i.e. But whatever is the extent of outlets displacing several hundreds Germany has also begun its the tie-up with the suppliers like the euphoria sought to be created by the of the existing vendors.

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