Will the FDI initiatives be stalled in parliament?

Business

oi-Sunil

By Sunil Fernandes

Updated: Friday, November 16, 2012, 15:12 [IST]

Ever since the government announced the reforms process, particularly allowing foreign direct investment (FDI) in multi-brand retail, pension and insurance, stock markets have been on fire and the rupee has gained ground.

The euphoria and investor ecstasy may now be short lived, as the opposition parties are all geared to prevent the passage of the bills, particularly hiking FDI in insurance and allowing FDI in the pension sector, which need parliament approval.

FDI in multi-brand retail is an executive decision and does not need parliament's approval, during the winter session, which begins on November 22. However, the CPM said it has submitted notices in both the Houses seeking a discussion on the issue under rules entailing voting.

"In both the Houses, the CPI(M) members have given the notices and we wish to take this up for a proper discussion under rules which will entail voting," senior CPM leader Sitaram Yechury said. "Any such decision (allowing FDI in multi-brand retail) will have to be endorsed by Parliament and the government should not go behind the cover of saying that this is an executive decision," the Economic Times quoted Yechury as saying.

Now, if there is a voting the government is likely to be embarrassed as it does not have the numbers and needs the support of SP and the BSP for safe passage. Interestingly, the SP and the BSP have made their positions clear, that they are not favour of FDI in retail. To compound the government's misery, the DMK too may play truant.

"Small and medium retail traders in Tamil Nadu are apprehensive that foreign direct investment will greatly affect them. We will discuss and take a decision on this (FDI) keeping their interest in mind," Karunanidhi said in Chennai on Wednesday.

he NDA is clearly opposed to the bill, apart from the Akali Dal, whose stand is still not clear. The TMC, AIADMK and BJD are already opposing FDI in multi-brand retail.

If there is voting, there is a possibility that FDI in multi-brand retail, may not get through.

FDI in pension and increase in FDI in insurance definitely needs voting and approval from parliament, and these bills are likely to be in a limbo.

Of course, for all this to happen, one has to hope and pray that parliament sessions are not adjourned and that there is a discussion and than a vote.

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