Prime Minister Manmohan Singh has spoken in favor of the government recent decision to allow Foreign Direct Investment (FDI) in Multi Brand retail in the country.

He said that the FDI in the sector will benefit farmers and consumers and will also help in introducing new technologies in agricultural marketing in India. Dr. Singh was speaking after Parliament approved the decision of allowing FDI in retail as the chief guest at the Punjab Agricultural University's golden jubilee function.

Dr. Singh also pointed out that the decision is backed by the farmer associations in Punjab. He was honored with a Doctor of Science degree from the institution. The decision has created much political controversy in the country with opposition arguing against the proposal to allow 51 per cent FDI in multi-brand retail while government maintaining that it is good for the county and would boost economic growth.

"FDI has been passed by Parliament and it was strongly supported by organisation in Punjab. Agriculture and food retail business will be benefited by it, farmers and consumers will be benefited by FDI," the Prime Minister said in Ludhiana.

Those who favor FDI in multi brand retail in India argue that it will address the issue of supply bottle necks, develop supply chain infrastructure, reduce wastage of food and improve efficiency, besides generating employment. They also say that it will benefit farmers, who will be able to negotiate better deals with large firms and ultimately, customers, who will get commodities at a cheaper price.

Opponents argue that the allowing big international players will affect small retailers, which dot the country's streets. They cite the examples of Thailand and Malaysia, which allowing FDI in retail has resulted in problems for small retailers.