National Council Meeting (Raipur-Chhattisgarh), 12th-13th June, 2010

RESOLUTION NO. 4
Stop 100% FDI in Retail and Defence Production Sectors

FDI in Retail Sector
For more than a decade multinational retail giants have been making attempts to make an entry into Indian retail market and capture a huge market. At the same time there has been strong opposition to the same in India from different quarters. It may be recalled that during the prime minister ship of Shri P. V. Narasimha Rao, the then Finance Minister and the present Prime Minister had virtually opened up the gates for FDI in retail. Thanks to the change in the government, the process could be stalled. Once again, when this government took charge, attempts are on to open up this sector fully for FDI. Already FDI in single brand retailing has been allowed since 2006 and Wal-Mart and other giants are forcing their entry from back door via joint venture route (Bharti – Wal-Mart); and now, statements from people in the government clearly reveal that they are hand in gloves with multinational retailers. As a statutory obligation to reveal information about expenditure on lobbying, the Wal-Mart has revealed that it had spent USD 11 Mio (about Rs 56 crores) on lobbying for issues related to India and they had spent USD 1.37 Mio (over Rs 6 crores) in the year 2009 itself.

Efforts of the government pushing forward Wal-Mart to capture Indian retail market, clearly demonstrates its intentions to help Wal-Mart and a total disregard to the employment and livelihood of crores of small retailers’ interests.

Swadeshi Jagaran Manch urges the government to refrain from such attempts. If the government goes ahead with this misadventure, this Rastriya Parishad of SJM warns the government that a nationwide agitation would be launched involving people at large and small retailer community in particular.

FDI in Defence Production
Off late, there is a move by Ministry of Commerce to allow 100% Foreign Direct Investment (FDI) in defence production sector. Ministry of Industry, however, opines that the present cap of 26% may be increased to 49% or 50%. But the Ministry of Defence is vehemently opposing any increase in the FDI component beyond the existing 26%.

The different ministries of the same government are of the different opinion in this matter because of their own reasons. The money involved in defence deals, where funding is generally not a constraint on account of national security, is huge and there are substantial vested interests that are lobbying for various arguments.

Major overseas companies in defence production are generally notorious for their under hand dealings in sale of armaments as also in creating and instigating tensions among various countries in slightest provocations. Further, the critical/ sunrise technologies in offensive as also defensive armaments are religiously guarded by the possessing countries and they are under total control of their national governments. Hence it may be naïve on our part that by opening this sector for FDI will keep our defence capabilities on par with world leading countries.

It appears that the advocates of globalization in the present day establishment are keen to get acceptance for 100% FDI in this sector and the Ministry of Commerce has taken that mantle on itself.

This is a very sensitive issue relating to security of the nation. If we dismantle our defence production infrastructure and if FDI retreats, our position will be in jeopardy. It is the worldwide experience and is visible by the strategies adopted by all the nations that matter in present day world it will be suicidal to forego domestic control on defence production sector, that too in the present tense world.

Swadeshi Jagaran Manch, therefore demands the Government that it should refrain from any attempt to increase the present cap of 26% FDI in this sector. SJM also demands that Government should initiate steps to roll back the provision for this level of FDI as well in this sensitive sector.

SJM further urges that Research & Development in defence sector to be strengthened with needed budgetary support, so that our country can withstand and can retaliate any adventurous aggressions by hostile forces around us.