In India, a nation of shopkeepers frets over retail reform

Thu Sep 20, 2012 2:57am EDT
 
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By Annie Banerji

NEW DELHI (Reuters) - Customers squeezing through the narrow aisles of Sushant Goel's tiny grocery store in central Delhi need to be careful. Just brushing up against the rickety free-standing shelves packed with food and toiletries can cause them to wobble dangerously.

Goel, 61, inherited the general store, or kirana, in Delhi's Bengali Market from his father 23 years ago and is now slowly handing over the business to his sons. Like many kiranas, it is a business built on a reputation for reliability of service, one earned over generations.

But thousands of kirana owners like Goel planned to close their shops on Thursday to protest against a government decision to allow in foreign supermarkets such as Wal-Mart Stores Inc (WMT.N: Quote). They fear the move could lead to the destruction of the ubiquitous family-owned stores that occupy a central place in Indian daily life and help give the country the highest shop density in the world.

"If these big guys storm in and wreck what I've fostered for decades, then my family and I will have to resort to a different business," said Goel, who - after much thought - decided to open on Thursday because he couldn't afford to lose the business.

These fears are being exploited by the main opposition Bharatiya Janata Party (BJP), despite the pro-business party itself having championed retail reform when it was in power more than a decade ago. Elections are due soon in several states, and many, including Goel, see the BJP's call for protests as a cynical ploy to curry favour with kirana owners.

With an estimated 50 million kiranas and some 220 million people dependent on them for their livelihoods, according to the Confederation of All India Traders, mom-and-pop store owners represent a huge political constituency. India, it is said, is a nation of shopkeepers.

Political parties of all stripes have loudly rejected the government's decision and warned that better-organized foreign supermarkets will wipe out kiranas, leaving millions unemployed.

But Reuters interviews with industry analysts, store owners and some of their customers suggest that while change is inevitable in India's mostly unorganized retail sector, kiranas will likely survive and perhaps even thrive alongside supermarkets.   Continued...

 
A shopkeeper (R) and his sales assistant wait for customers inside a family-owned grocery store in an alley in the old quarters of Delhi September 17, 2012. Thousands of kirana, or general store, owners planned to close their shops on Thursday to protest against a government decision to allow in foreign supermarkets such as Wal-Mart Stores Inc. They fear the move could lead to the destruction of the ubiquitous family-owned stores that occupy a central place in Indian daily life and help give the country the highest shop density in the world. Picture taken September 17, 2012. REUTERS/Mansi Thapliyal