Opposition accepts govt’s FDI formula, Parliament logjam ends

Mangalore Today / PTI

New Delhi, Dec 7:  It’s what the country has been waiting for. A crucial all-party meeting has ended in less than half an hour with the news that the FDI-in-retail logjam is broken and Parliament will function today.

At the meeting he had called, Finance Minister Pranab Mukherjee read out a single-line statement announcing the suspension of the government’s decision to allow foreign direct investment in retail "till a consensus is developed through consultations with various stakeholders". The Opposition accepted that formula and agreed to allow Parliament to function from today.

 

Mr Mukherjee will now make a statement in both Houses of Parliament.
The resolution addresses at least one peeve of the opposition and some UPA allies - that the government had not thought fit to consult them on a matter of such critical import. But Opposition parties had so far insisted that what they wanted was a "rollback" of the decision, not a "holdback." The government has made no mention of a rollback, but Left leaders emerging from the meeting said they viewed the suspension of the policy till a consensus was evolved among all stakeholders as a "virtual rollback."  Those stakeholders have been defined at the meeting as leaders of all political parties and chief ministers of states. 
 
Before the all-party meeting the BJP’s Arun Jaitley had told NDTV, "FDI must go." But with the entire nation watching in impatience and much public debate on the waste of money and time as Parliament saw adjournment after adjournment  and no work at all in this session, there has also been pressure on the Opposition.

For the government, it is critical that Parliament begin functioning. Half the Winter Session has gone without any work transacted. In the next two weeks, it must clear a huge backlog that includes several important Bills, including the Lokpal Bill, which comes with the threat of another Anna Hazare hungerstrike and mass agitation attached. All of last week was lost to the Opposition forcing adjournments insisting that the government agree to discuss FDI in retail in Parliament and put it to vote. Or simply roll back its decision. "We hope that Parliament will run smoothly after the all-party meeting", Parliamentary Affairs Minister Pawan Kumar Bansal had told PTI yesterday. 
 
It was with that sentiment and after ally Mamata Banerjee expressed her inability to support the government on FDI in retail that it changed its mind; for days it insisted that there would be no backtracking on its reforms in retail. The government argued that it was an Executive decision that did not need Parliament’s nod. This week’s climbdown is being seen as a big dent to the authority of the Prime Minister, who went public with his insistence that FDI in retail was here, and here to stay.
 
Late last week, Ms Banerjee made it clear that she cannot support the government’s decision to allow 51 per cent foreign ownership of multi-brand retail stores because she believes it will jeopardize the livelihoods of farmers and traders by allowing the entry of international super-chains like Wal-Mart and Tesco. Subtly, the Congress indicated that it may not feel very differently - an opinion that was no doubt influenced by the fact that key states like Uttar Pradesh vote soon. 
 
Sources say no decision on FDI in retail is likely now till after the UP elections due in a few months from now. Congressmen from UP have been vocal in their advise to the party leadership that the timing of the policy decision could hurt their electoral prospects in the big state. The government would also like to see what new political equations emerge from those elections. If the poll outcome throws up new alliances in the state, with, say, the Samajwadi Party or even the Bahujan Samaj Party, it would mean new allies at the Centre, where the Congress’ numbers are tenuous and heavily dependent on allies like Mamata Banerjee’s Trinamool Congress, which has repeatedly used this to arm-twist the UPA government.
 
Watching from the sidelines, along with the rest of the country, corporate India has urged the opposition not to aim for petty political gains by fighting the government’s attempt to emerge from the "policy paralysis" it has been criticized for. Foreign Direct Investment in the fast-growing retail sector will "significantly" boost hiring activities and has the potential to create about 80 lakh jobs in the country, predict experts. Ma Foi Randstad’s MD and CEO E Balaji said, "Once FDI in retail is implemented, a lot of MNCs will come and bring along their own practices and policies." He cited the example of US-based Walmart, which alone employs close to 1.8 million people.