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Question

What are the advantages and disadvantages of fdi in india


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Solution

Below are few advantages and disadvantages of FDI in retail:
Advantages:
(a) Foreign companies can bring in better technology, management best practices, and more learnings for Indian players.
(b) FDI in retail will give a much-needed fillip to infrastructure in agriculture and farming practices.
(c) It will induce competition in the market benefitting both consumers and producers.
Disadvantages:
(a) Prices may be brought down initially, but once the MNCs get a stronghold in the market, they can cause price rise and may also form cartels harming the consumers.
(b) The predatory pricing policies of these big retailers will harm small and medium players in the sector.
(c) Negative Influence on Exchange Rates.


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