Aided by the absence of the Samajwadi Party (SP) and the Bahujan Samaj Party (BSP), the Manmohan Singh-led United Progressive Alliance government won the debate on allowing foreign direct investment in multi-brand retail in the Lok Sabha and the enabling rules: but the victory was numerical, not ideological.
Leader of Opposition Sushma Swaraj pointed out that 14 out of 18 spoke against FDI in retail, with only four speaking in its favour. “Going by their speeches, the numbers should actually translate into 282 MPs against FDI in retail and 224 MPs in favour of FDI in retail,” Swaraj said.
The final number in favour of the government decision, was 253 with 218 voting against.
SP with 22 MPs and BSP with 21 MPs walked out of the House before the voting. Of the 501 members in the House, only 471 voted. As there were no abstentions, several opted not to vote while being present. The walkout brought down the House strength to 502 and the halfway mark required to win the vote fell to 251. The government ally Dravida Munnetra Kazhagam (DMK) said yesterday it was opposed to the decision to allow FDI in retail but its MPs were present and voted in the House today.
After Tuesday’s furious debate, today, the accent of the speeches made by the government side was on how the move would help farmers, strengthen the procurement process and modernise agri-markets. The star speakers from UPA were Nationalist Congress Party (NCP) leader and Minister for Heavy Industry Praful Patel and young Congress MPs from Rohtak and Mathura, Depinder Hooda and Jayant Choudhary. While Hooda described himself as the son of a farmer and said farmers would gain from agricultural innovations taught to them by retailers.
Choudhary said there was difference between Opposition to foreign investment in retail and Opposition to organised retail per se. He said agriculture needed capital and FDI would be one source.
The Opposition refrain that not only was FDI in retail bad for the country, there was also no parliamentary consensus on it.
CPI leader Gurudas Dasgupta said, the FDI would make India eternally dependent on foreign funding.
“FDI in retail is not an end. It is a signal. The government wants to give a signal to the whole community of multi-national companies; to make India the most favoured destination of foreign investors. Is it the right strategy? Has anybody raised the question of overdependence on the overflow of foreign funds in a situation when India is hit by slowdown and sky-high inflation of food products?” he asked.
Harsimrat Badal of the Akali Dal admitted that in 2011 when FDI in retail was first mooted, the Akali Dal supported it. But “when we heard about the jobs that would be lost because of this” the party revisited the policy.
Earlier, replying to the debate, Commerce Minister Anand Sharma said, the FDI policy was a guiding policy and it was up to the states to accept or not accept it. “No one can tell an elected government what to choose and what not to,” he said.
The policy allows only cities with more than 10 lakh population to set up retail outlets with foreign investment in them. Though 53 cities will comply with this condition but with only 10 states and union territories agreeing to permit FDI in multi-brand retail, just about 18 cities in the country would roll out foreign-owned stores.
He countered the charge that stakeholders were not taken on board despite a commitment by Pranab Mukherjee, the then finance minister and leader of the house that no decision would be taken without a consensus. “After December 7, we spoke to farmers’ bodies again. Twelve such bodies were called. Consumer forums were also called and consulted – 17 of them and six bodies of food processing industries gave us their views in writing.” The government had also sent letters to all chief ministers after which 11 states were in favour, seven opposed and three states asked for further clarifications, he said. All this was contradicted by the Opposition.
The debate will now shift to the Rajya Sabha where it will be cut-throat because the UPA does not have a majority and will have to depend on walk-outs and abstentions.