Addressing a press conference in Patna, the Bihar chief minister also said he had voiced his apprehension to the United Progressive Alliance (UPA) government in New Delhi about allowing FDI in multi-brand retail.
"The retail business is doing well, the shopkeepers are earning money and people are buying their daily needs from them... If FDI comes in, what will be achieved? The farmers will not benefit," he said.
"When the central government wrote to me on the subject, I replied on every point and voiced our apprehensions. It (FDI) will not benefit the farmers at all. They (foreign investors) promise in the beginning that profits will reach farmers. But ultimately, the farmers get nothing," the JD-U leader said.
"Let the government bring FDI to where there is lack of capital," he said, alleging that the foreign investors wanted to "occupy" the Indian market.
"Why should we allow it... We are not at all in favour of implementing it in Bihar," the chief minister said.
On Friday, the UPA government cleared 51% FDI in multi-brand retail and 100% single-brand retail, besides allowing foreign investment in the aviation, broadcasting and power sectors.
Although the central government has cleared the 51% FDI in retail, the decision of whether or not to allow such investment rests with the state government.