Indicating that the Congress-led government is serious about building a consensus on allowing 51 per cent foreign investment in multi-brand retail, union commerce and industries minister Anand Sharma on Thursday sent a letter to the governments of Punjab, Uttar Pradesh and Odisha – three of the largest non-Congress ruled states – seeking support for the policy.
Though the union cabinet approved 51 per cent FDI in multi-brand retail and 100 per cent FDI in single-brand retail on 24 November last year, the proposal had to be shelved following strong opposition from not only the Bharatiya Janata Party ruled states, but also Mamata Banerjee's Trinamool Congress, the biggest constituent of the United Progressive Alliance after the Congress.
Banerjee has in recent times stymied most reformist moves by the government, with the Congress bending over backwards to appease it. But now it seems to have gained confidence to move without the TMC, particularly after it pushed through the candidature of finance minister Pranab Mukherjee for President despite Banerjee's opposition.
Sharma on Thursday sounded confident that a "political consensus" will be reached soon on the issue. "I am confident that the coming weeks will see the emergence of a consensus on liberalising FDI in multi-brand retail which will open immense opportunities," he said in an official statement from Moscow, where he was on a two-day visit for the India-Russia business dialogue, held under the umbrella of the St Petersburg International Economic Forum 2012.
Sharma has now initiated a move to seek the support of the three states in order to roll out the 51 per cent FDI in multi-brand retail, possibly after the presidential polls in July. The government will now have to only notify the new guidelines on multi-brand retail and need not go back to the cabinet for approval.
In identical letters to the three chief ministers Parkash Singh Badal of Punjab, Akhilesh Yadav of Uttar Pradesh, and Naveen Patnaik of Odisha, Sharma has said opening up FDI in multi-brand retail will bring in much needed investments, technologies and efficiencies to unlock the true potential of the agricultural value chain.