People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 50

December 16, 2012




We’ll Take This Issue to Streets


THE Left parties have always been opposed to the entry of foreign capital in retail trade. I remember the Walmart CEO had come to Delhi in 2005 and met the prime minister in order to get permission for starting business in India, but we opposed it when the proposal came forth in the UPA-Left coordination committee. In the same year the Left also submitted a note detailing why we were opposing this proposal. The then UPA government wanted to allow FDI in retail trade but could not because of our opposition. At that time the Left had 61 members in the lower house and the government was very much dependent on our support.


Why are we opposing the proposal? Certainly it is not for the sake of opposition. And not only us, even UPA allies like the DMK, Trinamul Congress, etc, and the SP and BSP that are supporting the government from outside, have been opposing it. Quite recently we saw that at least 60 per cent of the members were demanding rollback of the FDI in multi-brand retail trade. I never saw such a thing in 32 years of my stint in this house. There also was a Bharat Bandh on the issue on September 20. Crores of people came to the streets to protest the proposal. A large number of people courted arrest.


As for the claim made by Mr Anand Sharma that FDI would generate jobs, I ask: if there are only 21 lakh people employed in so many supermarkets across the world, who is going to believe that these companies would create 40 lakh jobs in the next three years? Joblessness is growing in cities and in villages. There has been only 0.8 per cent growth in employment between 2001 and 2010. Don’t you know that there is economic slowdown across the world? If the Walmart would provide one job, it would kill 17 jobs at the same time. Don’t you know that if it opens one supermarket, 1300 retail shops would get devastated? Yet you are supporting the idea! Yes, there would definitely be one change --- so far peasants have been committing suicide; now others too would do so.


Mr Rajiv Shukla talked about China here. Doesn’t he know that 90 per cent of retail trade in China is under government control? Walmart is sourcing goods worth 20 billion dollars from China compared to one billion from India. And when the Chinese felt the threat of displacement of retail trade, they enacted stricter legislations and regulations. But while you cannot give employment to people in our country, you are out to deprive the people who are somehow eking out their existence through small shops! And they number more than 20 crore souls.


Mr Kabil Sibbal referred to a statement made by our party leader, Sitaram Yechury, and accused us of inconsistency. But there is no inconsistency in our stand. We are not opposed to foreign capital per se; Yechury only said it must fulfil three conditions --- increase productivity, create new jobs and upgrade technology. This is our consistent stand. But FDI in retail trade does not fulfil any of these conditions. That is why we oppose it. If there is any inconsistency, it is in your stand. When the prime minister was leader of opposition in Rajya Sabha, he had written a letter to the then prime minister, opposing the FDI in retail trade and describing it as anti-national.


Once you said our pharmaceutical industry has grown very big after 100 per cent FDI was permitted in it. But what is the condition of the industry today? Two of our big companies have been taken over by multinationals. At the same time the prices of drugs and formulations have been going up constantly.   


As for the supposed benefits of FDI in retail trade, there is a wide variation between the farmgate price and the consumer price. Neither the peasants get proper prices for their produce nor the consumers get things are proper prices. There would be only monopolisation. Who is responsible for this situation? It is your policies that have created this situation.


Let me take the case of Monsanto which you allowed to operate in BT Cotton in 2002. Our whole standing committee visited Goregaon in Yavatmal district where the maximum number of suicide deaths had taken place. At least 50 widows recounted their tales to us. Through the seeds trade the Monsanto company earned some 35-40 thousand crore rupees, but a large numb of peasants had had to commit suicide. Whichever country the Walmart entered suffered the same fate --- no just prices for the producers, nor for the consumers!


Mr Anand Sharma said the FDI in retail trade would curb the rate of inflation. Some other luminaries too have made similar statements. But the government has failed to curb inflation. In fact, inflation has grown in several European countries too where the Walmart is operating.


As for post-harvest losses, who is responsible? We don’t have enough cold storages, and most of whatever we have are in the private sector. In the US, 70 per cent of the capacity is in government control. But what will the Walmart do on coming here? Will they create cold storages? Will the construct roads to link the villages with towns? Nothing of the sort; they are not going to invest in any such thing.


As for the claim that the Walmart and others would source 30 per cent of the goods from indigenous small and medium enterprises, a press note from Mr Anand Sharma said something else. It said: “Thirty per cent sourcing is to be done from micro and small enterprises which can be done from anywhere in the world and is not India specific. However, in this case, it has been stipulated that 30 per cent sourcing will be done from micro and small enterprises having planned capital machinery worth one million.” It is thus clear as to where this sourcing would be done from.   


These are the reasons we are opposed to the entry of foreign capital in retail trade in our country and we demand that the government seriously reconsider its decision. Of course you have managed your numbers, but the opposition witnessed on the issue was unprecedented. We saw how the no-confidence motion brought on July 22, 2008, was defeated by unscrupulous means, and this time too I know you are not going to give in to our genuine demand. But remember, we will take this issue outside, in the streets, and we will organise protest actions in the 53 cities where the Walmart and others are to be allowed to open their outlets. We will see to it that they are not able to do their business with ease.