Anda di halaman 1dari 9

SRI MANAKULA VINAYAGAR ENGINEERING COLLEGE (AFFILIATED TO PONDICHERRY UNIVERSITY) MADAGADIPET, PUDUCHERRY

DEPARTMENT OF MANAGEMENT STUDIES

PAPER PRESENTATION ON

IMPACT OF FDI IN RETAIL & AVITATION

AUTHOR: Leo U MASTER OF BUSINESS ADMINISTRATION EMAIL ID: leobeni42@ gmail.com CO AUTHOR: ARUL KUMAR MASTER OF BUSINESS ADMINISTRATION

IMPACT OF FDI IN RETAIL & AVITATION

countries. Exports and FDI have been the two key ingredients in China's rapid economic growth. According to the World Bank, FDI and small business growth are the two critical elements in developing the private sector in lower-income economies and reducing poverty.

INTRODUCTION

FDI AND DEVLOPING WORLD

Foreign Direct Investment FDI provides an inflow of foreign capital and funds, investment in addition to an increase in the transfer of skills, technology, DEFINITION

According to the International Monetary Fund, foreign direct investment, commonly known as FDI, "refers to an investment made to acquire lasting or long-term interest in enterprises operating outside of the economy of the investor." The investment is direct because the investor, which could be a foreign person, company or group of entities, is seeking to control, manage, or have significant influence over the foreign enterprise.

IMPORTANCE

FDI is a major source of external finance which means that countries with limited amounts of capital can receive finance beyond national borders from wealthier

and job opportunities. Many of the Four Asian Tigers benefited from investment abroad. A recent meta-analysis of the effects of foreign direct investment on local firms in developing and transition countries suggest that foreign investment robustly increases local productivity growth. The Commitment to Development Index ranks the "development-friendliness" of rich country investment policies.

At least 50%of total investment in back-end infrastructure Source at least 60% of farmer produce from small farmers having land holdings of less than 10 hectares. Source 30% of other suppliers from SMEs anywhere in the world

The government will have the first right in the procurement of agriculture products. FDI IN INDIA

Starting from a baseline of less than $1 billion in 1990, a recent UNCTAD survey projected India as the second most important FDI destination (after China) for transnational corporations during 2010 2012. As per the data, the sectors which attracted higher inflows were services, telecommunication, construction activities and computer software and hardware. Mauritius, Singapore, the US and the UK were among the leading sources of FDI.

IMPACT OF FDI IN INDIAN MULTIBRAND RETAIL

FOREIGN INVESTORS TO ENSURE

SHARE OF ORGANISED COS IN TOTAL RETAIL

JAPAN

66%

Policy mandates a minimum investment of $100 million with at least half the amount to be invested in back-end infrastructure, including cold chains, refrigeration, transportation, packing, sorting and processing. This is expected to considerably reduce post-harvest losses. This will have a salutary impact on food inflation from efficiencies in supply chain. This is also because

MALAYSIA

55%

INDONESIA

30%

CHINA

20%

INDIA

4%

Huge investments in the retail sector will see gainful employment opportunities in agro-processing, sorting, logistics management and front-end retail. At least 10 million jobs will be created in the next three years in the retail sector.

FDI in retail will help farmers secure remunerative prices by eliminating exploitative middlemen. Foreign retail majors will ensure supply chain efficiencies.

t food, which perishes due to inadequate infrastructure, will not be wasted. savings of Mumbai Rs 63,864

Rs Sourcing of a minimum of 30% from Indian micro and small industry is mandatory. This will provide the scales to encourage domestic value addition and manufacturing, thereby creating a multiplier effect for employment, technology up gradation and income generation. (annual)

2,500cr Kuala Lumpur

Rs 41,000

Total ATF of

bill Singapore

Rs 42,000

Dubai A strong legal framework in the form of the Competition Commission is available to deal with any anti-competitive practices, including predatory pricing. Domestic airlines: Rs 10,000cr

Rs 43,000

IMPACT OF FDI IN INDIAN AVIATION

FUE L

FOR ATF PRICES (per kilo liter) ATF

GROWTH Direc t

import could Delhi Resul in Rs 62,908

Scrips of three listed domestic carriers, Jet Airways, Kingfisher Airlines and Spice Jet rallied after the government on Tuesday allowed airlines to import jet fuel directly. The decision on direct jet fuel imports was taken by an empowered group of ministers (EGoM) headed by Finance Minister Pranab Mukherjee.

companies."

The scrip of Vijay Mallya-led Kingfisher Airlines hit an intraday high of Rs.30.90, up 20 percent from Monday's close of Rs.25.75 at the Bombay Stock Exchange. The stock was hovering around Rs.28.50 in

Analysts said the move, announced by Civil Aviation Minister Ajit Singh, would help airlines to cut 10-15 percent of their operating cost. The move will enable airlines to directly import jet fuel as an end user, thereby saving sales tax, which ranges between 20-35 percent and is levied by state governments.

The Indian aviation sector been reeling under rising aviation turbine fuel (ATF) prices caused by high sales tax and other levies. Domestic airlines are estimated to have lost around Rs.3,000 cr in the first six months of this fiscal."This is very positive news for the industry. The airlines can be able to save up to 10-15 percent of their operating cost as jet fuel accounts for nearly 50 percent of the cost," Sharan Lillaney, aviation analyst."The decision will help the airlines to break-even, pay back the oil marketing

afternoon trade. The Jet Airways stock too gained 18.06 percent and touched a high of Rs.351.90 from the previous close of Rs.298.05. The stock was Rs.336.90 around 2.30 pm. Budget carrier Spice Jet also gained 19.51 percent at BSE and touched an intra-day high of Rs.29.40 from the previous close of Rs.24.60.

important for the developing countries like India, because the emerging economy is in need advanced technology and adequate fiscal power. First the Indian economy must fix the poverty line index based upon calories intake per day rather than cost, due to insufficient consuming of food it

"We have to see how the airlines will import the fuel, do they have the cash to do so, where will they store the fuel, will they use the oil marketing companies' infrastructure or not. So there needs to be clarity on these things first, besides this, the news is very positive," said Lillaney.

Airlines have not yet come out with any logistics plan for storing and importing the fuel. This was one of the arguments by the three oil marketing companies Hindustan Petroleum, Indian Oil and Bharat Petroleum, who were opposing the move.

CONCLUSION

In this scenario I want to conclude that FDI is very much

creates many problem in birth of the baby and to the needy people. This can be eradicated only through giving quality food at low cost at present it is possible only by foreign direct investment in multi-brand retailing. The Indian aviation is almost in sunk condition there is no fiscal tool for meet out dues. In this scenario the Indian aviation can only be rescued by allowing 49% of FDI in aviation field.