An Empirical Study of Impact of Culture on Foreign Direct Investment in Retail Sector

Abstract

India is the world’s fifth largest global destination in the retail space. In FDI Confidence Index, India ranked 16 (after US, Canada, Germany, United Kingdom, China, Japan, France, Australia, Switzerland, and Italy). The Indian retail sector is a emerging sector and is the backbone of the Indian economy. The sector contribution is 14 to 15 percent of total GDP. India's retail market is estimated at US $ 500 million, one of the five best-selling markets in the world. The Indian food market is gaining popularity worldwide with 1.2 billion people. As of 2013, the Indian retail industry was actually controlled by the owner of small shops. In 2010, supermarkets and department stores accounted for about 4 percent of the industry, and these were only available in large urban areas. There are 40 million Indians (3.3% of Indians) who cover the Indian and commercial industries. Since 1991, Foreign Direct Investment (FDI) was limited to a number of areas such as manufacturing, infrastructure, etc. But in July 2011, the Indian government made 51% FDI for Multi - Retail and 100% FDI for Single - Brand Retail. The main purpose of this study was to determine the impact of Culture on Foreign Direct Investment.