backed out of its commitments to Punjab farmers. Both firms have vehemently denied this.
If, as the BJP made it out to be, the issue was about the poor farmer, surely there were other issues that needed to be raised? After all, farmers lose about 8-10% of their earnings to arhatiyas in government-controlled mandis who have a monopoly over sales—a farmer cannot directly approach a buyer, or vice versa, the deal has to be consummated through an arhatiya who takes all of 5 minutes, or maybe it’s 10, to auction off a few trucks of produce. How come no one whose heart bleeds for the farmer raised this, much less did anything about it?
If the debate was really about foreign investment, how come no one spoke about the significant investments made by FIIs in several retail chains in India? According to data cited by corporate law firm AZB & Partners’ founding partner Ajay Bahl, Bata has 18% FII investment, Titan 16%, Pantaloon 22% and Tribhovandas Bhimji 11%—it is true this is FII and not FDI, but both are foreign capital, and surely FDI is preferable to FII.
And the debate certainly wasn’t about kiranas even though Swaraj brought tears to many eyes when she read out the anti-retail FDI letter by Congress leader Priya Ranjan Dasmunsi who continues to remain in a coma for 4 years now—the helpful cameras in Parliament helpfully panned to Dasmunsi’s wife Deepa who is now a member of Parliament from her husband’s constituency. If it was about kiranas, why aren’t those opposed to retail FDI, and this includes the SP, also protesting about a Reliance Fresh or a Big Bazaar—after all, it can’t be more honourable for a kirana to die at Reliance’s hands than at Walmart’s.
In any case, anyone who has even a passing acquaintance with retail—which means you go shopping at least once a year—knows, it is not the kiranas that are closing down, it is the big retailers. So Subhiksha shut shop after its 1,600 outlets accumulated a debt of R750 crore and couldn’t pay it back; Pantaloon Retail’s gross debt of R6,300 crore means it has a debt/ebitda of an unviable 5.5, which is why the company is busy selling off stakes in group ventures; Shoppers Stop, about a fourth of Pantaloon by way of sales, has a lower, but equally uncomfortable, net debt/ebitda of 3.6 times.
There’s also the fact that there’s enough