New Delhi:
After two days of stormy debate, lawmakers in the Lok Sabha voted in favour of the government's big policy decision to open up the country's highly-protected retail industry to foreign chains such as Walmart.
The focus now shifts to Rajya Sabha. The Upper House will debate and vote on FDI over the next two days starting today; the Leader of the Opposition Arun Jaitley will initiate the debate which will begin around noon. Though the numbers are not in favour of the UPA government in the Rajya Sabha, it is hoping that the Samajwadi Party (SP) and the Bahujan Samaj Party (BSP) will bail it out.
"The debate in RS will start tomorrow. Voting will be on Friday. I am absolutely certain of it... while the numbers are very thin, I'm sure we are going to win this vote, may be with a very small margin, but I'm confident we are going to win this vote," Parliamentary Affairs Minister Kamal Nath told NDTV on Wednesday.
During the voting in the Lok Sabha on Wednesday, 471 of the Lok Sabha's 545 members voted; 253 MPs voted against the BJP motion that challenged the policy and 218 voted for it. (
Highlights of the debate in Lok Sabha) The majority mark was brought down from 273 to 251 by the BSP and the SP, which provide external support to the Manmohan Singh government, walking out to help the government. Samajwadi Party chief Mulayam Singh Yadav had a made a strong speech against FDI in retail in the Lok Sabha and the BSP had suggested that the government not rush into implementing it. (
Govt wins FDI debate in Lok Sabha: 10-point cheat-sheet)
The other vote that the government won yesterday was by defeating a motion moved by the Trinamool Congress against amendments to the Foreign Exchange Management Act (FEMA) to facilitate foreign investment in multi-brand retail. Before the debate on FDI began yesterday, the Opposition parties had sought that the two be delinked and voted on separately, but the Speaker ruled that they could be debated together. The government was keen to push the crucial FEMA amendments through.
The government has said reforms have won and India Inc is cheering.
Congress President Sonia Gandhi said that she was happy with the Lok Sabha win and wasn't worried about the vote in the Rajya Sabha, which will begin debate on FDI in retail tomorrow and will vote on Friday. (
Who said what after the govt won the FDI vote)
The government is on thin ice here, as it is in a minority and will need the active suport of the SP and the BSP to scrape through. BSP sources have said party chief Mayawati could go a step further in the Rajya Sabha and bail out the government by voting for FDI; she reportedly told party MPs that it would not be politically prudent to fall foul of the Congress. The BSP leader reportedly fancies her chances as an important player in government formation after the 2014 general elections. (
Why the BSP might bail the govt out in the Rajya Sabha)
The government's floor managers are counting on Mulayam Singh Yadav abstaining in the Upper House too. After walking out yesterday, Mr Yadav said, "Five crore (50 million) people in retail trade will be destroyed. This decision has ignored the interests of 20 crore (200 million) farmers and their families. The decision on FDI was taken under pressure of foreign companies. This is the reason the party boycotted it." Despite its strong words, the Samajwadi Party has indicated that it will not do anything to "trouble the government"
Senior Samajwadi Party leader Ram Gopal Yadav said this morning that his party was likely to abstain the the Rajya Sabha too. "Abstaining is also a form of protest. The BJP and Samajwadi Party are different political parties and we don't have to do what they say or do," he said.
The BJP, meanwhile, called the government's win a political victory but moral loss. "It a political victory but a moral loss. The people of this country will now give them a fitting reply during the elections. Those who did not vote with us today and abstained, in a covert way, have extended their support to the government's policy of FDI," Leader of the Opposition in the Lok Sabha, Sushma Swaraj said yesterday.
In her closing remarks, Leader of Opposition Sushma Swaraj slammed both the BSP and the SP for not walking their talk. "How vociferously Mulayam ji had opposed FDI...if he had voted with us, FDI would not have been implemented. It is not a question of BJP, this is not a communal issue. But the problem is the issue has now become FDI vs CBI...When the BSP wants support, they come to us and then we aren't communal. This dichotomy won't work." Ms Swaraj said referring to Ms Mayawati's recent comment that keeping "communal forces" at bay was a priority. After the vote Ms Swaraj said the government has "won politically but lost morally." (
Watch)
Mamata Banerjee, whose Trinamool Congress had moved against amendments to the Foreign Exchange Management Act (FEMA) vote said on her Facebook page, "It is a shame! The mandate today proves that the UPA-II is a minority Government...This Government has lost its credibility. They must take fresh verdict from the people."
A loss in the Lok Sabha would not have reversed the policy, but it would have dealt the government a severe blow and would have set back efforts to push through other reform measures. In his reply to the debate Commerce Minister Anand Sharma said, "Consensus does not mean unanimity. If you have to wait for unanimity, you wait till eternity. The states are free to choose whether to implement it or not." (
Watch)
The government's pro-market push, which includes efforts to cut subsidies, comes as India faces a sharply slowing economy, a gaping fiscal deficit and high inflation, which has stoked pressure on an administration already under fire for corruption.
During the debate, Opposition MPs lambasted the idea of foreign supermarkets in India, saying they would harm traditional family-owned shops where most Indians do their shopping as well as hit farmers. Mulayam Singh Yadav, an ally of the government but an opponent of foreign supermarkets, invoked the memory of independence leader Mahatma Gandhi who burned foreign cloth as a protest against British products.
Supporters of the arrival of chains such as Walmart, Tesco and Carrefour say it will revolutionise shopping in India, with consumers offered cheaper food in large, modern supermarkets, as well as improving the wasteful supply chain. Among conditions imposed on foreign supermarkets, they will have to invest a minimum of 100 million dollars, open stores only in towns with a population of more than one million and source 30 percent of produce from India. Previously the groups were restricted to owning wholesale operations in India.
Walmart, the foreign chain seen as the most keen to tap India's vast consumer market of 120 crore people, has since been tripped up by two separate investigations in the country.The prospect that has raised fears among opposition parties of small shopkeepers being put out of business.
The company is carrying out an internal probe into possible corrupt payments by its local joint-venture, while the government is investigating whether it broke the previous rules barring investment in the retail sector.