We need FDI in everything EXCEPT…..
Amazing how we keep saying we need FDI. Initially, say 10 years ago, Mr. BiG Bazaar did not want FDI in retail and Mr. Jet Airways did not want FDI in civil aviation. They successfully (lol!!) kept Singapore Airlines-Tata combine from forming an alliance. Awesome lobbying………….or whatever else it was.
The media does not want FDI in media, but will happily tie up with foreign with big media and tell them “we will publish under your brand name in India”……..
Then suddenly after a few years they suddenly become very investor friendly and blame the government for NOT ALLOWING FDI. The same set of people who said life insurance companies are ‘strategic’ and therefore they needed to hold 76%.
Actually all of them were waiting to enter the respective business, build up scale and then sell off to the existing partner or a new comer at a fancy price. Why! they even put a clause saying if their existing partner was trying to tie up with another person, they had to take the original partner’s WRITTEN permission…..
Most Indian businessmen like the License and Permit raj especially if they are the early license holders! It took Honda a hell lot of time in getting away from Hero group…Not sure when Starbucks will split from Tatas (remember Pepsi entered India with partnership from Tatas as did IBM?)…
What the government is doing is more than fair…no doubt about that. We should allow FDI only in industries where we have a great flourishing Indian brands. For e.g. if high end expensive shirts are now allowed into India, it will force Indian manufacturers (at the top end). If Virgin air is coming into India, Jet drops rates….long live the customer!
nikhil
how about fdi(fans direct investment) in “subramoney” !!!
pravin
this is true.that is why people who criticise free markets amaze me. no businessman loves the free market.the biggest beneficiary of the free market system is the rest of us: the consumers -the folks who provide the ‘demand’ part of the supply and demand equation.
there is no union or cartel of the consumers since each of our interest in getting a better value/cheaper deal is limited,we dont even have the incentive to lobby .IMO,the real job of economists is not to be policymakers or advisors,it should be to dispel the myths of trade and basic economics ala Bastiat whenever a Biyani writes a sickening lobbyist article in the economictimes appealing to faux patriotism.as if we owe biyani a living.
subra
Change and competition is good when you are a Consumer. It is bad when you are a manufacturer. So i want to travel by Indigo, but hate when it when Chubb comes to sell insurance in India, if I am an employee of GIC…..as simple as that.
It is ONLY competition which can improve standards…by the way do people still buy the Ambassador car?
Suresh
Sir
GIC is happy when Chubb comes to India – it helps improve underwriting standards and as the national reinsurer GIC gets better premium. A 5 crores liability policy fetched 30-40,000 pre Chubb/AIG , now fetches 100,000.
The customer is happy because some one knows how to handle claims.
The other PSUs also benefit from improvement in market standards. Win -Win.
Now, Lombard is another story altogether…
Howzzat for bias !!!