On the sidelines of the recently concluded Retail Association of India’s two-day Retail Leadership Summit in Mumbai, David French, senior vice president of government relations at the United States (U.S.) -based National Retail Federation (NRF), spoke exclusively to Fortune India on the current state of business in the north American country. The NRF is the world’s largest retail trade association overseeing the interests of the retailers in the U.S. The retail industry is also the second largest employer in the U.S.

French has over 30 years experience in lobbying in Capitol Hill and has been with NRF since 2011. Edited excerpts:

What’s the mood for the retail business in America?

French: To say the least, it is very healthy at the moment. People are still shopping. Retail sales grew faster than the GDP last year.

Is it a surprise event or is there a reason for the new momentum?

French: Under the current administration, corporate tax reform has rationalised the tax on business. It was one of the highest taxed businesses but due to the reforms retails brands saved nearly $ 17 billion last year. That has invigorated these companies to increase investments.

What have been the other fallouts of the tax break?

French: Many smaller businesses are learning to fight back. The traditional retailers are embracing e-commerce in a big way, with even the biggest retailer Walmart putting money in expanding its presence there. We are seeing a lot of convergence in channel with retailers in high street adapting newer techniques to keep its clientele. Businesses are getting more customised and hyper local. So, there is a push to efficiency as technology disrupts the business.

What were the biggest concerns for retailers in 2018?

French: The retailers have been anxious about tariffs as this is something that they can’t easily work around. But so far it is more anxiety than reality as nothing has changed on the ground. But, any standoff with China is immediately a big concern that will definitely hurt at a time when most companies are investing in change and expansion.

The retail business in the U.S. stands accused of being environmentally unfriendly, shipping millions of packages every day. Are businesses and government responding to the charges?

French: Ethical consumerism is on the rise but there has not been a policy debate at the government level.

David French

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