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Great that modern retail goes to small cities. But it’s a big responsibility for Delhi politicians

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Smaller cities and small towns are where the next stage of the India growth story is being and will be played out. Significant mutual fund contribution from non-metros was one chapter of this narrative. Anecdotal and some statistical evidence of increasing purchasing power is another. Opening of modern retail stores is a third, and in many ways, a crucial chapter. Big names, domestic only, since FDI in retail remains caught in Delhi’s politics, setting up retail stores in non-metros deepens reforms. They give smaller cities and towns the kind of consumer experience that has been so far limited to metros. They generate white-collar, medium skill employment. They provide another option for producers who, to put it mildly, aren’t treated with great care by unorganised sector middlemen. In general, modern retail chains create the ambience of economic optimism.

So how to assess protests that have greeted the opening of some of these stores in smaller cities? First, the right of those who are protesting for whatever reason is sacrosanct, and all official responses must bear that in mind. Second, before exciting aam aadmi theories are constructed from these protests, let their limited nature be noted. Third, state governments have a responsibility to see that just as protesters should not be denied their chance, companies opening shop cannot be denied their right to do business either. Vandalism is not the same as a protest, and no state government or city authority must confuse the two as modern retail expands its scope.

The fourth point is directed at those who practise politics in the national capital. Retail expansion should have been a straightforward case, including the FDI part of it. But two governments at the Centre have made a mess of it, and this government has had the dubious honour of being publicly ticked off by the ruling party. By now, India should have experienced a full-blown retail revolution, instead of only seeing the beginnings of it. Now that the sector is witnessing some real transformation, another set-back is simply unaffordable. There will be a big loss of credibility if the issue goes back to the drawing board again. Let’s put it this way, a GoM on retail expansion will not be compromise, it will be a big defeat. That should make clear to major political actors in Delhi what they must and must not do.

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