(a) Discuss the impact of FDI entry into Multi-trade retail sector on supply chain management in commodity trade pattern of the economy. (b) Though India allowed Foreign Direct Investment (FDI) in what is called multi-brand retail through the joint venture route in September 2012, the FDI, even after a year, has not picked up. Discuss the reasons.

Theme

T130 Liberalisation & FDI: retail, defence, Indian firms vs MNCs

What UPSC asks in this theme

UPSC asks why India needs FDI and why MoUs don't become investment, FDI in defence and multi-brand retail, and whether Indian firms compete with MNCs after liberalisation.

What to cover

• FDI policy: automatic vs government route
• MoU–actual FDI gap: land, approvals, policy uncertainty
• FDI in defence and multi-brand retail: caps and effects
• Liberalisation effects on Indian firms

Writing the answer

• Pros, cons, reforms

These notes are for the whole theme, built from all 4 of its PYQs. UPSC does not publish model answers.