FDI in Retail V/s Session of Parliament
EVER since the government announced it Cabinet's decision to allow FDI in retail (100% in single brand and 51% in multi brand, a couple of days ago, the government has ensured that no parliamentary proceedings take place. There was no consensus even within the Cabinet about the issue (the matter has been in public domain for the last three years, debated twice in the Standing Committee too, but without result) and yet the Prime Minister was adamant. (We, here must remember the background of PM as World Bank stooge, as also his signing the agreement in 1991 itself to open up Indian markets), against the advice of his colleagues including Moily, Jairam Ramesh; and its ally TMC. (Now, SP, BSP & DMK too have opposed) When pointed out by Ramesh that it may have a wrong effect in UP elections, Sharad Powar resorted, Congress has no stakes there (Is Rahul Gandhi listening?).
THE day the Cabinet decided, the same day government had reached an agreement with the oppositions for smooth functioning of both houses of parliament by agreeing to adjournment motions on black money and price rise in Lok Sabha and Rajya Sabha respectively. The government wants the issue to be debated but only under rules not entailing voting. Clearly, the government wants to escape the embarrassment of losing as all opposition is united against this FDI and some allies of UPA too are against it.
THE government, however is harping on the advantages of FDI in retail sector. First, it will be beneficial to producers as they can expect better returns on their products. This argument has been summarily rejected by the father of green revolution Dr. Swaminathan as the products can be declared below standard or not up to the mark. Besides, these Houses, as the experience shows, buy from the local producers, at the best from those located within a distance less than 100 kms. The clause of purchasing at least 30% from SMEs too may not bear results as multinationals never follow such commitments. An example can be given of Pepsi Foods who was allowed on the condition of selling at least 50% of its products abroad but it never did. Besides, these MNCs may create their own SMEs, defeating the argument in totality.
SECOND, it is claimed that it will benefit the consumers. This too may not happen as the MNCs, initially will sell cheap to drive out the competition from traditional retail shops (known as Pop & Mom Stores in US)Here too, an example can be given of Cadbuarry who enticed the cultivators of Karnakata to sow cocoa but later ditched them.
THIRD, the dream sold that it will create 10 million jobs in the next three years may be false, as pointed about by Swaminathan that how many jobs will be lost by it has not been estimated. Besides, small retailers ans petty shopkeepers, after closing shop, too will joint big houses; i.e. the masters of their own destiny will have to be servants.
FINALLY, about the timing of the decision. The government does not want to introduce the bills on Lok Pal, judicial accountability etc., and so wants the pot boiling. Ironically, almost all decisions of the government taken during UPA II are eroding the credibility of the government resulting in restless in AAM AADMI.
THE day the Cabinet decided, the same day government had reached an agreement with the oppositions for smooth functioning of both houses of parliament by agreeing to adjournment motions on black money and price rise in Lok Sabha and Rajya Sabha respectively. The government wants the issue to be debated but only under rules not entailing voting. Clearly, the government wants to escape the embarrassment of losing as all opposition is united against this FDI and some allies of UPA too are against it.
THE government, however is harping on the advantages of FDI in retail sector. First, it will be beneficial to producers as they can expect better returns on their products. This argument has been summarily rejected by the father of green revolution Dr. Swaminathan as the products can be declared below standard or not up to the mark. Besides, these Houses, as the experience shows, buy from the local producers, at the best from those located within a distance less than 100 kms. The clause of purchasing at least 30% from SMEs too may not bear results as multinationals never follow such commitments. An example can be given of Pepsi Foods who was allowed on the condition of selling at least 50% of its products abroad but it never did. Besides, these MNCs may create their own SMEs, defeating the argument in totality.
SECOND, it is claimed that it will benefit the consumers. This too may not happen as the MNCs, initially will sell cheap to drive out the competition from traditional retail shops (known as Pop & Mom Stores in US)Here too, an example can be given of Cadbuarry who enticed the cultivators of Karnakata to sow cocoa but later ditched them.
THIRD, the dream sold that it will create 10 million jobs in the next three years may be false, as pointed about by Swaminathan that how many jobs will be lost by it has not been estimated. Besides, small retailers ans petty shopkeepers, after closing shop, too will joint big houses; i.e. the masters of their own destiny will have to be servants.
FINALLY, about the timing of the decision. The government does not want to introduce the bills on Lok Pal, judicial accountability etc., and so wants the pot boiling. Ironically, almost all decisions of the government taken during UPA II are eroding the credibility of the government resulting in restless in AAM AADMI.
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