Finance Minister Pranab Mukherjee on Monday
told Opposition leaders, including Sushma Swaraj and Sitaram Yechury, that the decision on allowing
FDI in retail was being put on hold and a final decision will be taken only after
consulting all opposition parties.
"The government is willing to keep the decision in suspension. It will take a final decision only after consultations with all opposition parties and the stakeholders," sources said after Mukherjee spoke to Swaraj, Leader of the Opposition in Lok Sabha, and CPI(M) MP Yechury this morning.
Swaraj is believed to have told Mukherjee that the government should come out with a statement on the issue, which has created a
logjam in Parliament for several days now.
Yechury is understood to have told the Finance Minister that an all-party meeting be convened before the next sitting of Parliament where parties should be informed about the decision.
Retail tie-ups takes a backseat as FDI move gets politicised An announcement could then be made in Parliament, the sources said, adding that the all-party meeting could be held on Wednesday morning before the proceedings begin.
Mukherjee had last week told an all-party meeting, which had asked the government to reverse the FDI decision, that he would get back to them after he consulted the Prime Minister and the Union Cabinet which had taken the decision.
Traders bandh against FDI in retail gets mixed response Yechury is understood to have told Mukherjee on Monday that it would be in fitness of things that all political parties are informed about keeping the decision to allow 51 per cent FDI in retail in abeyance.
The opposition, however, is still firm on having a discussion in Parliament on major issues like price rise and blackmoney under rules which entail voting, the sources said.
Associated Press reports- The furor over whether to allow chains such as
WalMart to open supermarkets in major cities has deadlocked Parliament, with many politicians slamming the decision as a job killer for India's small retail shops.
Proponents say it would bring needed investment into India's infrastructure that would bring higher prices to farmers selling their produce and lower prices to consumers buying it.
Retailers back govt despite Opposition protests An about-face on such an important decision would raise serious questions about the ability of India's ruling party to effectively govern.
On Sunday, Congress spokesman Manish Tewari had said the party "welcomes any steps which can lead to a conducive resolution of the issue and break the deadlock."
Analysts and business leaders slammed the Congress party for potentially bungling a crucial policy change that has been a decade in the making, and bemoaned the weak leadership of Prime Minister Manmohan Singh in the face of a parliamentary revolt.
"It makes the position of Manmohan Singh even more weak. Clearly the man carries no authority," said Arvind Singhal, founder of Technopak Advisors, a New Delhi-based consulting company.
US welcomes FDI in retail move He said India's lack of leadership was eroding much-needed investment, from domestic businesses as well as foreign. "The impact on investors will be very negative in terms of confidence," he said. "We need FDI, but India needs significantly more investment from within."
The change in foreign investment rules for retail does not require parliamentary approval, and many questioned the government's wisdom in announcing the controversial plan while Parliament was in session, in the buildup to crucial state elections.
RBI says FDI in retail will reduce inflation "It was bad planning," said agriculture analyst P.M. Sinha, a former PepsiCo executive in South Asia. "They could have waited a few weeks and nothing would have happened."
He said he believes the government will prevail and the changes will ultimately go through.
"The middlemen have a pretty strong lobby, but it is just a matter of time now before they're pushed aside," Sinha said.
Dismay over the government's inability to implement long-promised reforms that could spur economic growth has intensified as India's economy slows. The
economy grew just 6.9 per cent in the September quarter, the slowest in more than two years.
India's flagging growth is seen by many as a crisis of governance.
"A slowing economy seems to pale in comparison to the larger crisis at hand - that of a Parliament that is completely unable to function in the way these sacred institutions were set up to be," HDFC Chairman Deepak Parekh and former Unilever chief Ashok Ganguly said in a
joint statement on Sunday.
"Opposing investment in modern retail for the sake of it is only defending vested interests to the detriment of the vast majority," they said.
"The farmers, the consumers and the common people must raise their voices against this false drama of apprehension against investment and modernizing trade in agriculture and consumer goods."
- With PTI inputs
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