After months of discussion,  the issue of FDI in retail is being deliberated in the Lok Sabha today.  In September 2012, the Cabinet had approved 51% of FDI in multi-brand retail (stores selling more than one brand).  Under these regulations, foreign retail giants like Walmart and Tesco can set up shop in India.  Discussions on permitting FDI in retail have focused on the effect of FDI on unorganised retailers, farmers and consumers. Earlier, the central government commissioned the Indian Council for Research on International Economic Relations (ICRIER) to examine the impact of organised retail on unorganised retail. The Standing Committee on Commerce also tabled a report on Foreign and Domestic Investment in the Retail Sector in May, 2009 while the Department of Industrial Policy and Promotion (DIPP) released a discussion paper examining FDI in multi-brand retail in July, 2010.  Other experts have also made arguments – both in support of, and in opposition to, the move to permit FDI in retail sales. The table below summarises some of these arguments from the perspective of various stakeholders as collated from the above reports examining the issue.

Stakeholder

Supporting arguments (source)

Opposing arguments (source)

Unorganised retail
  • No evidence of impact on job losses (ICRIER).
  • The rate of closure of unorganised retail shops (4.2%) is lower than international standards (ICRIER).
  • Evidence from Indonesia and China show that traditional and modern retail can coexist and grow  (Reardon and Gulati).
  • Majority of small retailers keen to remain in operation even after emergence of organised retail (ICRIER).
  •  Unorganised retailers in the vicinity of organised retailers saw their volume of business and profit decline but this effect weakens over time (ICRIER).
  • Other studies have estimated that traditional fruit and vegetable retailers experienced a 20-30% decline in incomes with the presence of supermarkets (Singh).
  • There is potential for employment loss in the value chain. A supermarket may create fewer jobs for the volume of produce handled (Singh).
  • Unemployment to increase as a result of retailers practicing product bundling (selling goods in combinations and bargains) and predatory pricing (Standing Committee).
Farmers
  • Significant positive impact on farmers as a result of direct sales to organised retailers.  For instance, cauliflower farmers receive a 25% higher price selling directly to organised retailers instead of government regulated markets (mandis).  Profits for farmers selling to organised retailers are about 60% higher than when selling to mandis (ICRIER).
  • Organised retail could remove supply chain inefficiencies through direct purchase from farmers and investment in better storage, distribution and transport systems.  FDI, in particular, could bring in new technology and ideas (DIPP).
  •  Current organised retail procures 60-70% from wholesale markets rather than farmers. There has been no significant impact on backend infrastructure investment (Singh).
  • There are other issues like irrigation, technology and credit in agriculture which FDI may not address (Singh).
  • Increased monopolistic strength could force farmers to sell at lower prices (Standing Committee).
Consumers
  • Organised retail lowers prices. Consumer spending increases with the entry of organised retail and lower income groups tend to save more (ICRIER).
  • It will lead to better quality and safety standards of products (DIPP).
  •  Evidence from some Latin American countries (Mexico, Nicaragua, Argentina), Africa (Kenya, Madagascar) and Asia (Thailand, Vietnam, India) reveal that supermarket prices for fruits and vegetables were higher than traditional retail prices (Singh).
  • Even with lower prices at supermarkets, low income households may prefer traditional retailers because they live far from supermarkets, they can bargain with traditional retailers and buy loose items (Singh).
  • Monopolistic power for retailers could result in high prices for consumers.

Source: ICRIER [1.  "Impact of Organized Retailing on the Unorganized Sector", ICRIER, September 2008]; Standing Committee [2.  "Foreign and domestic investment in retail sector", Standing Committee on Commerce, May 13, 2009]; Singh (2011) [3. "FDI in Retail: Misplaced Expectations and Half-truths",  Sukhpal Singh, Economic and Political Weekly, December 17, 2011];  Reardon and Gulati (2008)  [4. "Rise of supermarkets and their development implications," IFPRI Discussion Paper, Thomas Reardon and Ashok Gulati, February 2008.]; DIPP [5. "Discussion Paper on FDI in Multi-brand Retail Trading", Department of Industrial Policy and Promotion, July 6, 2010]


The National Anti-Doping Bill, 2021 is listed for passage in Rajya Sabha today.  It was passed by Lok Sabha last week.  The Bill creates a regulatory framework for anti-doping rule violations in sports.  It was examined by the Parliamentary Standing Committee on Sports, and some of their recommendations have been incorporated in the Bill passed by Lok Sabha.  

Doping is the consumption of certain prohibited substances by athletes to enhance performance.  Across the world, doping is regulated and monitored by the World Anti-Doping Agency (WADA) which is an independent international agency established in 1999.   WADA’s primary role is to develop, harmonise, and coordinate anti-doping regulations across all sports and countries.   It does so by ensuring proper implementation of the World Anti-Doping Code (WADA Code) and its standards.  In this blog post, we discuss the need of the framework proposed by the Bill, and give insights from the discussion on the Bill in Lok Sabha.  

Doping in India

Recently, two Indian athletes failed the doping test and are facing provisional suspension.   In the past also, Indian athletes have been found in violation of anti-doping rules.  In 2019, according to WADA, most of the doping rule violations were committed by athletes from Russia (19%), followed by Italy (18%), and India (17%).  Most of the doping rule violations were committed in bodybuilding (22%), followed by athletics (18%), cycling (14%), and weightlifting (13%).  In order to curb doping in sports, WADA requires all countries to have a framework regulating anti-doping activities managed by their respective National Anti-Doping Organisations.  

Currently, doping in India is regulated by the National Anti-Doping Agency (NADA), which was established in 2009 as an autonomous body under the Societies Registration Act, 1860.  One issue with the existing framework is that the anti-doping rules are not backed by a legislation and are getting challenged in courts.  Further, NADA is imposing sanctions on athletes without a statutory backing.   Taking into account such instances, the Parliamentary Standing Committee on Sports (2021) had recommended that the Department of Sports bring in an anti-doping legislation.   Other countries such as the USA, UK, Germany, and Japan have enacted legislations to regulate anti-doping activities.  

Framework proposed by the National Anti-Doping Bill, 2021

The Bill seeks to constitute NADA as a statutory body headed by a Director General appointed by the central government.  Functions of the Agency include planning, implementing and monitoring anti-doping activities, and investigating anti-doping rule violations.  A National Anti-Doping Disciplinary Panel will be set up for determining consequences of anti-doping rule violations.  This panel will consist of legal experts, medical practitioners, and retired athletes.  Further, the Board will constitute an Appeal Panel to hear appeals against decisions of the Disciplinary Panel.  Athletes found in violation of anti-doping rules may be subject to: (i) disqualification of results including forfeiture of medals, points, and prizes, (ii) ineligibility to participate in a competition or event for a prescribed period, (iii) financial sanctions, and (iv) other consequences as may be prescribed.  Consequences for team sports will be specified by regulations.   

Initially, the Bill did not have provisions for protected athletes but after the Standing Committee’s recommendation, provisions for such athletes have been included in the Bill.  Protected persons will be specified by the central government.  As per the WADA Code, a protected person is someone: (i) below the age of 16, or (ii) below the age of 18 and has not participated in any international competition in an open category, or (iii) lacks legal capacity as per their country’s legal framework

Issues and discussion on the Bill in Lok Sabha

During the discussion on the Bill, members highlighted several issues.  We discuss these below-

Independence of NADA 

One of the issues highlighted was the independence of the Director General of NADA.  WADA requires National Doping Organisations to be independent in their functioning as they may experience external pressure from their governments and national sports bodies which could compromise their decisions.  First, under the Bill, the qualifications of the Director General are not specified and are left to be notified through Rules.  Second, the central government may remove the Director General from the office on grounds of misbehaviour or incapacity or “such other ground”.  Leaving these provisions to the discretion of the central government may affect the independence of NADA. 

Privacy of athletes

NADA will have the power to collect certain personal data of athletes such as: (a) sex or gender, (ii) medical history, and (iii) whereabout information of athletes (for out of competition testing and collection of samples).  MPs expressed concerns about maintaining the privacy of athletes.  The Union Sports Minister in his response, assured the House that all international privacy standards will be followed during collection and sharing of data.  Data will be shared with only relevant authorities.

Under the Bill, NADA will collect and use personal data of athletes in accordance with the International Standard for the Protection of Privacy and Personal Information.   It is one of the eight ‘mandatory’ standards of the World Anti-Doping Code.  One of the amendments moved by the Union Sports Minister removed the provision relating to compliance with the International Standard for the Protection of Privacy and Personal Information.

Establishing more testing laboratories across states

Currently India has one National Dope Testing Laboratory (NDTL).  MPs raised the demand to establish testing laboratories across states to increase testing capacity.  The Minister responded by saying that if required in the future, the government will establish more testing laboratories across states.  Further, in order to increase testing capacity, private labs may also be set up.   The Parliamentary Standing Committee on Sports (2022) also emphasised the need to open more dope testing laboratories, preferably one in each state, to cater to the need of the country and become a leader in the South East Asia region in the areas of anti-doping science and education.

In August, 2019 a six-month suspension was imposed on NDTL for not complying with International Standard for Laboratories (ISL) by WADA.  The suspension was extended for another six months in July, 2020 due to non-conformity with ISL.  The second suspension was to remain in effect until the Laboratory complies with ISL.  However, the suspension was extended for another six months in January, 2021 as COVID-19 impacted WADA’s ability to conduct an on-site assessment of the Laboratory.  In December, 2021 WADA reinstated the accreditation of NDTL.

Raising awareness 

Several athletes in India are not aware about the anti-doping rules and the prohibited substances.  Due to lack of awareness, they end up consuming prohibited substances through supplements.  MPs highlighted the need to conduct more awareness campaigns around anti-doping.  The Minister informed the House that in the past one year, NADA has conducted about 100 hybrid workshops relating to awareness on anti-doping.   The Bill will enable NADA to conduct more awareness campaigns and research in anti-doping.  Further, the central government is working with the Food Safety and Standards Authority of India (FSSAI) to test dietary supplements consumed by athletes.  

While examining the Bill, the Parliamentary Standing Committee on Sports (2022) recommended several measures to improve and strengthen the antidoping ecosystem in the country.  These measures include: (i) enforcing regulatory action towards labelling and use of ‘dope-free’ certified supplements, and (ii) mandating ‘dope-free’ certification by independent bodies for supplements consumed by athletes.