Does Inflation Facilitate Foreign Investments in Indian Retail Sector?

If one observes the comments of Indian Prime Minister Dr Manmohan Singh’s, a doubt arises whether the Indian government is going to show rising inflation as an excuse for inviting foreign private investments in Indian retail sector.

The Vice-President of planning commission Mr Montek Singh Ahluvalia has been telling that supply side bottlenecks have been the major cause for the rising inflation in India. Today, speaking at a conference in New Delhi Prime Minister Manmohan Singh expressed concerns over rising inflation adding that inflation is becoming a major obstacle for the growth prospects of India.

An important aspect of Mr Singh was that what he opined for rise in inflation. He said that the farm supply chains needed to be boosted with organised retail chains. This raises doubt that Indian government is going to give permission for foreign entry into retail sector in the name of organized retail chains.

If that happens lakhs of Indian retail shop owners will lose their livelihood. Indian people will also several options to buy their daily needs at number of retail shops.

Mr Manmohan Singh has been dreaming about double digit growth for India. He may have a desire that India should reach double digit growth figure during his premiership.

Market oriented Manmohan Singh was never elected directly by the people. Hence, there are lesser chances for him to feel the hardships of millions of Indian poor and middle class people.