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isguised unemployment.

In the modern retail system there is low incidence of disguised unemployment as the working hours are fixed with employees working on a rotation basis.

The other differences between unorganized and organized retail are in the supply chain. Unorganized retail usually generates a larger number of intermediaries in the supply chain (like wholesalers), whereas the organized retailers normally reduce the need for multiple intermediaries thereby streamlining their supply chain. However the organized retail generates more employment in the allied activities, like packaging, logistics, and inventory.

In July 2010 the Indian government had released a discussion paper on 'Foreign Direct

Investment in Multi-Brand Retail Trading' (DIPP (2010) whether FDI should be allowed in multi-brand retail along with the applicable conditions. One such condition proposed was that the jobs be reserved for rural youth in the organized sector. This proposal was criticized since organized retail was largely located in urban areas of India and this may lead to rural-urban migration however the discussion paper failed to address issues of quality of employment, the future job prospects and the requirements of skill development in retail, all of which are crucial in a country that has a large working population and vital for FDI. (Arpita Mukherjee & Tanu M. Goyal April 2012)

On examining the employment impact for the large retailers, Basker (2005) concluded that Wal-Mart normally creates approximately 100 jobs in a year, but this is done by eliminating intermediaries where there is a loss of around 40-60 jobs. Thus there is an overall net employment effect that is positive. Basker also noted that Wal-Mart employees work for fewer hours in a week that creates opportunities for part-time employment. Reardon and Gulati (2008) studies also show that employment in the organized retail sector has enhanced the pay and working conditions mainly due to the adherence to labor laws. They also noted that the organized retail sector needed higher skills and education than the unorganized sector. However they argued that the number of unorganized retailers may not decline with the growth of the organized sector.

Mukherjee and Patel (2005) study showed that since both the unorganized and organized retail sectors are growing, there was no clear evidence of job losses in the unorganized sector. Joseph and Soundararajan (2009) study found that if there are any adverse effects of retail modernization that would be worn off with time.

Also the perception studies (Guruswamy et al., 2005; Sarma, 2005; Singh, 2010) showed that organized retail may have a negative impact on the unorganized sector because of buying power malpractices, price competition and employment loss in the value chain however this can be countered by lowering or controlling the pace of modernization.

FDI flow is based on business opportunities arising due to immense technological advance resulting in modern business evolving at a great pace (Birkinshaw, 2000; Alfaro et al., 2004).

FDI brings benefits to the national economy by contributing to the Gross Domestic Product (GDP) thus contributing towards debt servicing repayments and producing foreign exchange revenue thus aiding in the economic development of the country.

(Kamath, 1994; Lemoine, 200