31 December, 2011 (English) - Bharatiya Janata Party

UPA trapped in its ownweb in “FDI in Retail”By Arun JaitleyThe UPA government isfacing a major crisis. Thegovernment ill-timed itsdecision on allowing FDI inmulti-brand retail. Both from theviewpoint of economic realitiesof India and the present politicalsituation, any political observerwill be surprised by the timingof the decision. Thegovernment’s credibility is atrock bottom. The leadership hasbeen unable to counter theallegations of both corruptionand economic mismanagement.The agenda of Parliament wasalready loaded with issuesembarrassing to the government.With great difficulty, it attemptedto ward off a voting motion onprice rise and agreed to a votingon a resolution on black moneyand corruption. In the midst ofParliament session, the Cabinettook a decision to allow FDI inmulti-brand retail.What was the politicalcompulsion behind thisdecision? In the last few years,the government was conveyingan impression that it hadabandoned the path of economicreforms. The business confidencein the Indian economy has beendeclining. For three years,inflation has remaineduncontrolled. Fuel prices havetouched a new high, partlybecause rising internationalprices of crude oil and partlybecause of the high taxationimposed on petroleum products.Infrastructure creation hasDecember 16-31, 2011 13slowed down. The investmentenvironment in the country hasbeen destructive. Fiscal deficithas risen and the GDP growth islikely to decline this year. Facedwith the criticismthat governmentwas doingnothing, thegovernmentsuddenly decidedto go in for a bigticketagendanamely FDI inmulti-brand retail.The decisionof the governmentunited theotherwisefragmentedopposition. Thetwo majorconstituents of theUPA viz. Trinamool Congressand DMK decided to oppose themove. The two parties givingoutside support to the UPAgovernment viz. SamajwadiParty and the BSP faced with thecompulsion of the Uttar Pradeshelection also decided to opposethe government. Parliamentarynumbers are loaded against thegovernment. The governmenthas got in a chakra-vyuha. It isfinding no escape route. If it rollsback the decision, the PrimeMinister will lose face. It is agreesfor an adjournment motion witha vote, the Parliamentarynumbers are loaded against thegovernment. The governmentcannot afford to lose the vote andhence, its entire energy isconcentrated on the DMK andTMC to get them dilute theirposition. Small retail is the onlysignificant component ofBengal’s economy. Tradersconventionally have beenagainst the CPI (M). If the TMCagrees to support thegovernment, it can end up giftingthe traders’ vote to the CPI (M),and thereby reducing its ownvote bank. Its political oppositionis therefore understandable.Parliament is stalemated notbecause of the disturbance of theOpposition but that thegovernment is not able to find asolution. A negative vote willhurt the government and so willthe rollback. Today, it is facedwith the dilemma of losing inboth the situations. The characterof Indian economy is such thatFDI in multi-brand will certainly