FDI in retail is death knell for small industries: Sushma Swaraj

FDI in retail is death knell for small industries: Sushma Swaraj

Click to Expand & Play

New Delhi Asserting that Foreign Direct Investment or FDI in multi-brand retail will sound the "death knell" for small industries and traders, BJP leader Sushma Swaraj today accused the government of having failed to evolve a political consensus on the controversial issue despite making a promise in Parliament.

Initiating the debate in the Lok Sabha on FDI in retail, the leader of opposition said the government claim that foreign investment would benefit farmers, consumers and generate employment was a myth.

"The government has gone back on its promise of holding consultation with all stakeholders before allowing FDI in retail. It is sad that no effort was made to make a political consensus and no meeting or any consultation was held with even the main opposition party," she said. (Rate Sushma Swaraj's speech here)

"International experience shows that retailers do predatory pricing, and once they come to India, they will reduce prices so that smaller shops get shut... and when the competition is over, they will raise prices and the consumers will have no option but to buy at high prices," said Sushma Swaraj in a forceful speech.

Trashing the government's assertion that foreign investment would put an end to middlemen, she said: "FDI in retail will not end the middlemen culture. There are instances like in sugar industry where there are no middlemen but still farmers have to struggle for sugarcane pricing."

She quoted Punjab's example saying Pepsi promised to buy potatoes and tomatoes from farmers, but backed out later.

Countering the government's claim that FDI will increase employment, she said: "Government says that FDI will generate employment for 40 lakh people. But going by figures if we have to employ so many people, then all companies like Wal-Mart, Tesco and others coming to India need to open over 36,000 stores in 53 cities, which means over 600 stores in each city."

Sushma Swaraj said FDI in retail would sound the death knell for small industries.

"Government says that foreign companies will have to take 30 per cent product from Indian small and medium enterprises, which means 70 per cent will be imported."

"Can any industry be viable at 30 per cent production? And 90 per cent of the imported stuff will come from China and it will generate employment and growth in China, not India," she said.

"Small shops, retailers have been wiped out in countries which allowed FDI in retail. About 12 crore people will go out of jobs in India due to the UPA government's decision to allow FDI in retail," she said.

She quoted US President Barack Obama saying small business are engines of growth in the US.

"President Obama is spearheading the campaign to encourage Americans to shop at small business establishments. When the rest of the world is questioning FDI in retail, why are we welcoming it," she said

Sushma Swaraj also read out from a letter of Prime Minister Manmohan Singh, which he wrote as the then leader of opposition in the Rajya Sabha, in which he opposed FDI in retail.

Targeting the prime minister, Sushma Swaraj said: "PM makes bold statements like if we must go down, we'll go down fighting. You must Mr PM, but fight for the poor, not the rich, fight for country, not multi-nationals, fight for small, not big."

FDI in retail "is not the step to success and improvement but is the way to the pits of destruction".

"I am not against FDI; however I am against FDI in retail. FDI should be allowed in power, airports but not retail," she said.

"We don't want to defeat you and get our way, we want to convince you and win. But if you are adamant, we will force you," she said.

"If the government does not take the decision back, then I appeal to my colleagues here, vote with us and defeat FDI (in retail)," she added.
Story First Published: December 04, 2012 18:14 IST

................................ Advertisement ................................

FROM THE WEB
MORE FROM NDTV
Don't Miss

................................ Advertisement ................................