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CAIT quizzes Centre about FDI in retail; 11 pertinent questions raised
Monday, 19 November, 2012, 08 : 00 AM [IST]
Akshay Kalbag, Mumbai
The Indian National Congress (INC) is defending the United Progressive Alliance (UPA), which is led by the party and is currently in power at the Centre, on the issue of foreign direct investment (FDI) in retail, and that the leaders of the party and the government aren't actually aware of the facts and figures and must strive to obtain the same, according to the Confederation of All India Traders (CAIT).

Strongly recommending that they do their homework on the subject, CAIT said, “The chief ministers of Congress-ruled states must understand that the government notification has just come into force and wait for the same and the Reserve Bank of India's (RBI) amendments in the Foreign Exchange Management Act (FEMA) rules to be passed by both Houses of Parliament before inviting global retailers to their states.”

Apart from this, the traders' body – which has been vociferously campaigning against FDI in retail – also came down heavily on the government for their failure to reveal a number of key facts and figures and also for concealing a few true ones. With Parliament's Winter Session slated to commence soon, B C Bhartia, the body's national president, and Praveen Khandelwal, its secretary-general, raised 11 questions with the government.

Eleven questions

The first of the 11 questions raised by the office-bearers of the traders' body was, “Is it not a fact that the foreign direct investment (FDI) policy papers laid down by Anand Sharma, Union Minister of Commerce and Industry and Textiles, on the floor of Parliament on November 25 last year and the notification issued by the government on September 20 this year have major deviations?”

“Is it correct that the government came to know about the true facts and figures of food wastage in India through the study report on post-harvest losses prepared by the Central Institute of Post-Harvest Engineering and Technology (CIPHET), in September 2012,” they asked, adding if that were true, what compelled them to repeatedly quote that the food wastage till now was 40 per cent – which is an incorrect figure – and even mention that in the 2012-13 Union Budget?

Bhartia and Khandelwal asked, “What figure of food wastage was quoted in the Cabinet Note, based on which the Cabinet took the decision to allow FDI in retail,” and added, “If this figure was quoted as 40 per cent, then why didn't the ministers of agriculture and food processing industries raise objections and correct the figures of food wastage, since they knew the true and correct figures?”

Another question raised by the duo pertained to the failure of the ministers of state for food processing industries, Harish Rawat and Charan Das Mahant, to quote the reference of the true facts and figures as stated in CIPHET report in September 2010. They also wanted to know why the notification was issued in haste despite knowing the fact that the FEMA rules were awaiting amendment before issuing the notification?

“Isn't it correct that the development of the cold storage and a modern transport system was assigned as one of the major reasons for allowing FDI in retail? They why weren't the words 'cold storage and modern transport system' not explicitly included in the definition of back-end infrastructure as defined in the notification,” was another question asked by CAIT's national president and secretary general.

“Isn't it incorrect that the solemn assurance made by the finance minister to consult every stakeholder before taking a decision has been flouted by the government? Moreover, if the stakeholders have indeed been consulted, then is it not binding on the government to spell out the names of the individuals with whom the consultations have been made,” asked Bhartia and Khandelwal.

CAIT's national president and secretary-general also asked, “Is it not correct that under multi-brand retail, which the foreign direct investors will attempt to make forays into, the trading of grains and pulses which are not has been permitted,” adding, “If that is so, would the government give the reasons why they have decided to bring unbranded produce under the purview of multi-brand retail?”

Bhartia and Khandelwal said, “Is it not correct that before taking such a major decision which will have vital impact on livelihood of crores and crores of people of the country, no extensive study or survey has been conducted by the government before taking a decision, adding that so far the government has advocated only the advantageous argument not supported by any logical and conclusive material.”

In the larger interest of the nation, the government must reveal the logical facts. CAIT has also sought an appointment with UPA chairperson Sonia Gandhi on this issue.
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