Its contradictary... He says walmart in developing countries are not low cost destinations but upscale market. This means an average indian consumer would not go there... then how does it affect a small trader who anyways doesnt get an upmarket consumer?
The second claim of low wages...is also incorrect...as if to say the small traders pay the employee very well and walmart wouldnt.
Dumping produce from other countries...like bringing tea from sri lanka and bangladesh. Even today we get tea from these countries and they have not affected our produce. Imports with or without walmart will continue and market forces will decide if they can be successful or not.
The problem with walmart is not in india but in US where it is a low cost market sourcing products from china, india and low cost destinations...thereby making it difficult for american manufacturers to compete.
RE:Why Wal-Mart should not enter India
by Lok on Apr 23, 2007 03:42 PM Permalink
I don't know why people like Wade Rathke are even acknowledged at the first place. The truth of the matter is developing countries continued to remain poor because of disparity in prices and quality of goods and services vis a vis the rest of the developed world. By disparity i mean the amount of money a person spends as a % of his income on consumable goods in Inida is disproportionately higher than it is in developed countries. Its only becuase of big corporations that prices and trade across borders achieve a parity on a global scale. We have been cheated, looted, misguided by these so called small bania traders and they deserve to starve. In any case they have amassed enough wealth to become suppliers to walmart. If they can't change the economics of purchases and consumptions shut shops. The debate again seems to be going against foregin retailers vs organized retail. we need organized retailers, no matter whichever country they belong to. we are all consumers and we need better quality products and lesser prices. (better parity vs. our incomes).
RE:Why Wal-Mart should not enter India
by ravi prakash on Apr 23, 2007 04:28 PM Permalink
The Case of Wal-Mart has to be seen in the light of the US experience. Wal-Mart is selling low cost goods produced by China mainly, and other third world countries such as India, Bangladesh, Bolivia, etc. The presence of low cost fragile but attractive goods from China is so high that they have flooded out all other mfrs systematically. A second more important point is the highway system and the immense sprawl of homes that makes walking down to a nearby grocery store an impossible thing. The public opinion has veered to close the inflow of Chinese goods in the US so all kinds of lobbies have sought to portray the labour practices of Wal-Mart in a bad light- there is a labor legislation which is active and can tie up Wal-mart in a flood of class action and other damage suits. The condition for Wal-Mart to move to India are to provide the Indian consumer with "high quality Chinese goods" at "reasonable prices" Thus they would seem to address the upscale middle consuming classes at prices lower than the present Malls but better or equal to the US dollar prices. All this will mean is that it will become more difficult for the local manufacturer and large distributors of shoddy goods at lower prices to compete with Wal-Mart. The way out is not to curb Wal-Mart but to make it easy for the local Indian Manufacturers to make the appropriate investments in quality mfg. and free them up from the inspector-permit and direct tax demons. In view of the poor conditions of the roads I do not think it will kill the local Kirana shops. If the existing goods distributors continue to distribute substandard goods and the local general stores continue to hawk them then gradually they will find the consumer moving to these malls- Wal-Mart or no Wal-Mart.
RE:Why Wal-Mart should not enter India
by junnedkhan on Apr 23, 2007 04:05 PM Permalink
Dear Mohan, Tussi Dil Khush Kar Ditta Si, Wah what a great analysis. But I have some reservations agains walmart, becuse till now in India we have not seen anything as gigantic and leechy and scrappy as walmart (there is not a single hyper market in the country even today and walmart is the biggest in the world, far ahead of its next rivals, Geant and Lamarche for instance). The concern is that walmart would not stop at opening a few markets in your upscale neighbourhoods like gurgaon and bambai. They will the measure the whole country right and left. 5 years down the line you might find 10-20 walmarts in a second class town in UP. What will they sell in UP? Maybe sugar from latin america and cheap clothing from china. That will certainly affect the local economy very badly. By the way have you seen a walmart store? or do you have any idea of at what scale they operate? you will be fearful if you knew. Farmers are co
