Workers’ rights groups in India are speaking out against the recently-announced entrance of Wal-Mart into the Indian economy via a partnership with an Indian media company. The Center of Indian Trade Unions (CITU) warns that Wal-Mart will destroy the livelihood of small-scale retailers across the country. There are an estimated 40 million shopkeepers whose businesses could be hurt, says B.K. Pandhe, president of the CITU. The Service Employees International Union (SEIU) in America, which has been outspoken about the impact of Wal-Mart on U.S. workers, has met with CITU to discuss the retailer’s impact on India. The CITU opposes foreign direct investment in retail, and will hold a nationwide strike involving 50 million employees, according to Forbes.com. “We’ve heard enough from unions in the U.S. on Wal-Mart’s operations there and we don’t want employees and retailers to be hurt by its entry into India,” Pandhe told Forbes. According to Forbes, (Wal-Mart) “eschews unions in the United States but allows them where they are required.” CITU said that large retailers, whether Indian or U.S.-based, would hurt small-scale retailers and farmers. The large corporations claim they can cut out distributors, and offer farmers good prices. What the Indian media calls “organized retailing” is seen, in the distribution of food, as being a means to create new storage and transportation networks, that will prevent agricultural produce from going to waste.
The suggestion that Wal-Mart will offer farmers “good prices” is not supported by the retailer’s record in any other country. Wal-Mart uses its size to force suppliers, like farmers, or large agricultural corporations, to lower their prices, which means lowering not just the commodity itself, but the cost of labor to produce the commodity. The idea that Wal-Mart would give small farmers a good deal is to entirely misunderstand the corporate model as it has evolved over the past 44 years. As far as new infrastructure, there are no doubt many alternative ways to create storage and transportation networks without have foreign companies dominating the market. International companies are a sump-pump draining profits from the local economy, and CITU obviously has understood that lesson from Wal-Mart’s track record. For earlier stories, search Newflash by “India.”