~:FDI in retail: Won’t step back on Retail FDI, says PM Dr.Manmohan Singh:~
NEW DELHI: Prime Minister Manmohan Singh has rebuffed calls to reverse a decision to open up India's retail sector to global giants such as Walmart Inc, asserting the move will help farmers and consumers, increase employment and modernise a sector dominated by small stores.
"I am confident that foreign direct investment in retail will help to bring modern technology in the farm sector, less wastage and more jobs," Singh said at a meeting of the Youth Congress, which is headed by Rahul Gandhi. The PM said he was confident that owners of small shops would be able to compete with large retailers. Congress President Sonia Gandhi, who spoke after the prime minister, did not comment on the political storm over retail, choosing instead to focus on corruption.
The government has two options, political observers say. It can stick to its decision, facing down concerted opposition, including some from within its ranks. On the other hand, if it chooses to back down, it will only reinforce the impression of haplessness. The onslaught from the Opposition was reinforced by dissent from within.
"MNCs with deep pockets will hurt the interests of the poor," Sanjay Singh, a Congress MP who represents the Sultanpur Lok Sabha constituency in poll-bound Uttar Pradesh, said. The Bania community, which dominates trading in many parts of India, accounts for 6% of voters in Uttar Pradesh.
The Bahujan Samaj Party, or BSP, which is in power in the state, and Mulayam Singh Yadav-led Samajwadi Party, the BSP's principal rival, have been strident in their opposition to the prospect of global retail majors entering India. Finance Minister Pranab Mukherjee, who has strongly backed the move to allow foreign retail companies to own 51% of Indian supermarkets, will address MPs on Wednesday on the issue of FDI in multi-brand retail as well as other concerns such as inflation.
He was reportedly instrumental in persuading the Union Cabinet to back the decision to open up the retail sector, overcoming reservations expressed by several ministers. Earlier on Tuesday morning, a meeting between the government and Opposition parties failed to work out a formula that would allow Parliament to function.
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