Addressing a conference organised Tuesday by Jindal Global Business School, Thomas Lairson, professor of international business, Rollins College, US, said India should learn from the experience of China, Japan and Brazil, whose economies have benefited from FDI in retail.
Lairson said opening of retail in India will lead to potential reduction of inefficiencies in that sector.
The Indian government recently took a decision to allow up to 51 percent foreign direct investment (FDI) in multi-brand retail. This has paved the way for the global retail giants like Walmart and Carrefour to open their stores in India.
In single-brand retail, the FDI limit is hiked to 100 percent from earlier limit of 51 percent.
Analysing the Chinese experience, Lairson observed that the key is managing interdependence with the developed world.
Lairson said FDI intensified the competition in China's domestic market, improved the efficiency of the economy, and propelled state-owned enterprises to reform and China's transition to a market-oriented economy.
In 1970, imports and exports together constituted just five percent of China's GDP but rose significantly to 65 percent by 2005 due to significant opening of the economy.