Kumar Rajagopalan, Chief Executive Officer (CEO) of Retailers Association of India spoke to 'The Goan Everyday' detailing his plans to work with the state government on retailing policy, which would be of vital help in the era of GST
The Goan (TG): How do you think will Goods-and-Services-Tax (GST) benefit Goa?
Kumar Rajagopalan (KR): Goa will gain from GST because consumption is really high in the state. Traditionally, India used to look at taxation from production viewpoint, which meant that taxes were levied on various stages of production. But, under GST, the tax finally is levied on the sale of a product to the end consumer, while all stages of production can get input-tax-credit.
In such a case, Goa will gain because consumption is really high in the state. Moreover, tourists visiting the state also consume products and services. Overall, GST will enhance state government's tax revenues.
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TG: What kind of a role do you see Retailers Association of India playing in Goa?
KR: We would like to work with the state government here to understand their inclination towards retailing. We need to understand that retailing is extremely important. When you decide to live in a city, you check whether it has schools, hospitals, retailing and entertainment or not. The latter two aspects can be combined together to call them ‘retaining'.
In the last two years, Chief-Ministers of states like Maharashtra, Andhra-Pradesh and Karnataka have understood that retailing can be a big enhancer of gross-domestic-product (GDP). These states have worked with Retailers Association of India to create a retailing policy. Eight more states are working with us to come out with such policies. Goa can also gain by having a retailing policy because consumption on account of locals and tourists is very high in the state. We will approach the state government to work together on retailing in the next six months.
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TG: The onslaught of competition from online retailers like Amazon and Flipkart has threatened the very existence of small shops and traders in Goa? How do you think they can deal with such competition?
KR: Today, customers decide where they want to buy a product. But, for a customer to buy, price and service both are important. It's not that customers go entirely by price. It also depends upon which product we are talking about. For example, if you have to buy a garment to go to a party, you will go to an offline store. Lot of small stores exist only because they can provide good service to customers.
Take the example of a local grocery store in a neighbourhood. It may so happen that this store doesn't have a product, which a customer desires. But, if it can make this product available at the customer's door-step within 24 hours, it can easily deal with any competition.
