11.06.2013

Note that no packaging, refining, processing or even grading is involved in such a supply chain. The markup is attributable to the relocation of produce from farm to market. According to the media, a simple product such as carrots or bringel passes through the hands of up to seven middlemen before reaching the consumer.

Traditionally, the informal retail sector has enjoyed the protection of the Indian National Government since the days of Mahatma Ghandi. Even today, millions of informal hawkers earn a living with small vegetable or fruit stalls at street corners or in one of many weekly markets, called “mandis”. Acknowledging the limitations and inefficiencies of the existing goods supply system, the Indian Government recently decided to legalise foreign direct investment (FDI) in the Indian retail sector, a move accompanied by fierce public debate, demonstrations and strikes lasting several days.

Whilst there is a certain amount of hope that the market entry of the global players will improve and professionalise the sector to the benefit of the consumer, there is also concern over long-term implications.