The results of the study - carried out by Delhi based Birla Institute of Management Technology (BIMTECH), and submitted to the trade ministry - show consumers would support the arrival of multi-national grocery brands.

The study appears to be in response to a Government discussion paper on the subject of deregulation.

84% of 660 people surveyed said they would welcome the relaxation of FDI rules. Kartik Dave, associate professor at Birla Institute of Management Technology explains why, "customers are definitely going to benefit on price, and better quality of service".

Go-slow approach

Despite seemingly overwhelming consumer support, BIMTECH recommend a go-slow approach, suggesting that the unorganized sector is given five years to prepare for the organized challenge.

Having taken advice from experts, BIMTECH conclude that without breathing space the unorganized sector will be undermined, leading to potential mass unemployment and social unrest.

In the meantime BIMTECH suggest a government funded development program. Additional training in areas of customer service, merchandising and sourcing would help the unorganized compete against more sophisticated challengers.

Foreign investment in the back-end is not feared, consensus is that an improved supply chain will benefit everyone.

Importance of pricing

In addition, BIMTECH recommend that unorganized retailers form co-operatives, using their improved buying power to pass on lower prices to consumers.

Safeguards against predatory pricing should also be put in place to make it harder for multi-nationals to drive up prices after establishing market share through discounting. In addition to displaying the maximum retail price (MRP) on each product, BIMTECH believe the first point price (FPP) should be shown for the purposes of transparency.