Retail FDI, Fema debates clubbed

Left, BJP wanted separate debates, with voting, on the two issues

The government today combined the two motions tabled in the Lok Sabha, for a debate on the decision to allow foreign direct investment (FDI) in multi-brand retailing, and on the associated change in the Foreign Exchange Management Act (Fema). The debate is scheduled for tomorrow.

The government move attracted vociferous opposition from the Bharatiya Janata Party and the Left parties, which demanded separate debates, with voting, on the two issues. The government opposed the demand and Speaker Meira Kumar finally rejected it, too, citing the rules under which she had to take up the amendments of the members in consultation with the leader of the House.

The motion for discussion, “That this House recommends to the government to immediately withdraw its decision to allow 51 per cent FDI in multi-brand retail trade”, was moved by the BJP’s Sushma Swaraj and Khagen Das from the Left. The one on Fema was moved by Trinamool Congress member Saugata Roy and independent MP Hassan Khan, for omission of the provisions to facilitate multi-brand retailing in the law.

ROLLER COASTER RIDE

July 23, 2011 Committee of Secretaries recommends opening  of the multi-brand retail trade

November 24, 2011 Cabinet clears 51% FDI in multi-brand retail, hikes single brand retail FDI to 100%

December 5, 2011  Govt bows to political pressure and puts multi-brand retail FDI policy on hold 

September 14, 2012  Cabinet decides to operationalise 51% FDI in multi-brand retail, with the rider that states can say yes or no to foreign-owned stores

September 21, 2012 Centre notifies multi-brand retail FDI policy

WHAT NEXT
Voting in Parliament on multi-brand retail FDI may embarrass the government but it is unlikely to result in a policy rollback. However, foreign chains are not in a terrible hurry to set up shop in the midst of political uncertainties

The Speaker, as noted, ruled the debate on both FDI and Fema would be held together, after which a vote could take place separately, tomorrow.

The demand for separate discussion and voting was raised by BJP leader Yashwant Sinha and supported by Basudeb Acharia (CPIM) and Gurudas Dasgupta (CPI). Sinha stressed that a debate and voting on FDI in retailing under Rule 184 (entailing a vote) should not be clubbed with the one regarding modifications to the Fema notifications, issued by the Reserve Bank in October.

Members, he noted, had the right to move amendments to the Fema modifications up to 30 working days from the time it was tabled in Parliament.

As the notification was tabled on November 30 and the 30-day period would not end even on December 20, the last day of the current winter session, he said the Fema part can be carried forward and discussed in the Budget Session or even the monsoon session.

The speaker said she had consulted Parliamentary Affairs Minister Kamal Nath and Home Minister Sushilkumar Shinde. The two issues were related and, therefore, to avoid a repetition, it was decided to have a combined discussion.