Put on hold the decision to ease FDI norms, demands SJM

Swadeshi Jagran Manch expresses its deep anguish over the central government's decision to ease FDI norms in almost all major sectors of the economy, including defence, plantation, broadcasting, single brand e-commerce, banking, construction, limited liabilities partnership, duty free shops etc.

It is an established fact supported by empirical data that FDI is not a panacea of all ills. It is not a solution for all problems. FDI has done more bad than good to the economy. There have been more outflows of royalty, interest, dividend, profits, salaries etc., than inflows of FDI. In 2014-15 alone while there has been FDI inflow of 31 billion USD, there has been an outflow of 36.5 billion USD.

SJM contests the government's argument that FDI would bring growth and create employment in the country. Government has been advocating liberal FDI regime under its plans to revive manufacturing sector in the country, in the name and style of Make-in-India slogan. Swadeshi Jagran Manch firmly believes that government's endeavour towards Make-in-India should be more of Made-by-India. Government data reveals that FDI is not the driver of overall investment and growth in the country. There are instances, when FDI and overall investment levels have moved in opposite directions quite significantly. For instance, in overall terms, while FDI has been growing in leaps and bounds, gross capital formation has fallen from 38% of GDP in FY08 to a mere 28.7% in FY15.

Experience of Indian economy in the last 25 years of globalisation has been very distressing, whereby rate of growth of employment has slowed down, rate of reduction in poverty has come down, inequalities have widened and there is no reprieve for the common man.

In this background Swadeshi Jagran Manch has been consistently demanding a white paper from the government on the cost and benefits of FDI in this country. It is painful to see that present government continues to follow the policy of previous UPA government in this regard. SJM reiterates its demand for a white paper and urges the government to share the factual position with the people of India instead of repeating mere claims and intention.

Swadeshi Jagran Manch believes that the present decision of the government to ease FDI norms for major sectors of economy has been taken in a hurried manner, without going into the pros and cons of the decision. SJM demands to put these decisions on hold and constitute a commission taking all stake holders on board and also institute a comprehensive study to estimate loss to the economy.

Dr. Ashwani Mahajan
All India Co-Convenor
Swadeshi Jagaran Manch