The Union Cabinet's decision to allow 51 per cent Foreign Direct Investment (FDI) in the retail sector has drawn flak from Orissa Chief Minister Naveen Patnaik who termed the move 'ill-advised and regressive'.

Blaming the Central government for not taking immediate steps to contain the stubborn double digit inflation, Patnaik flayed the UPA-led government for approving 51 per cent FDI in a sector which offers employment to a major section of the country's workforce.

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“I am deeply distressed to hear about Union Cabinet's approval for allowing 51 per cent FDI in the retail sector. You will no doubt agree with me that the biggest challenge facing the country on Monday in the persistent double digit inflation which is adversely impacting the life of common man. Instead of taking immediate steps to tackle this problem, the Central government has now allowed FDI in a sector which provides employment to a major section of the workforce of the country,” Patnaik wrote in the letter to the Prime Minister.

Patnaik held that the move would only favour the large MNCs (multi-national companies) which will have monopoly over retail trade in this country.

He suggested the Government of India should have strengthened the marketing opportunities for farmers and small scale manufacturers of the country through appropriate supply side interventions like stepping up investment in rural infrastructure and research and development (R&D) for augmenting farm productivity.

Patnaik also took a dig at the Centre for arriving at such a policy decision without adequate consultation with the state governments.

The UPA-led government has come under attack from the Opposition and its allies alike with the Trinamul Congress seeking withdrawal of the move in the interest of workers and farmers.

In the face of mounting opposition, the Union finance minister Pranab Mukherjee has called an all-party meeting on Tuesday to work out a solution and wriggle the Union government out of the crisis.

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