FDI in retail: UPA government agrees to judicial inquiry into Walmart payoffs

Reports say the retail giant spent over Rs 125 crore on lobbying in India

By Jyotika Sood
Last Updated: Saturday 04 July 2015

The hurdles for the UPA government in implementing FDI in retail sector continue. After winning the number game in Parliament, the government will now have to face a judicial inquiry and a legal battle on the allegations that retail-giant Walmart had spent over Rs 125 crore on lobbying in India.

The moves come following a revelation on December 10 by US daily Washington Post. It had published a report that Walmart spent around $25 million (around Rs 125 crore) for lobbying in the country to gain entry into Indian market. The report stated that “Global retail giant Walmart — waiting for years to open its supermarkets in India — has been lobbying with the US lawmakers since 2008 to facilitate its entry into the highly lucrative Indian market’’. The money was allegedly used for lobbying activities that included gaining enhanced market access for investment in the country.

This caused uproar in Parliament where the opposition parties, including Bharatiya Janata Party (BJP), Janta Dal (United), All India Anna Dravida Munnetra Kazhagam (AIADMK), Trinamool Congress, Rashtriya Janta Dal (RJD) and Communist Party of India (CPI) demanded the setting up of a joint Parliament committee inquiry and stalled the house on December 10 and December 11. Finally, on December 12, parliamentary affairs minister Kamal Nath announced in Lok Sabha that “the government will appoint a retired judge to hold a time-bound inquiry into the media reports regarding Walmart.”

Notably, Samajwadi Party which had bailed out the UPA government by staging a walkout from the Parliament when voting was conducted on FDI retail in both the Lok Sabha and Rajya Sabha has also asked for a judicial inquiry into the issue.

While the Parliament report is likely to take a time, a legal battle has also kicked off. A lawyer M L Sharma moved court on December 11. He filed a public interest petition in the Supreme Court based-on Washington Post's report. The plaintiff has sought a direction from the apex court to the Centre to get details about the lobbyists and the ones who have benefited through the negotiations.

The Washington Post report states that “in the last quarter that ended September 30, 2012 itself, the company spent $1.65 million (about Rs 10 crore) on various lobbying issues, which included “discussions related to FDI in India.” The petition says lobbying isn’t a crime in the US but it’s bribery in India which is a serious offence under the Prevention of Corruption Act. “No one has any constitutional power or immunity to pollute our parliamentary system directly or indirectly,’’ says the petition. It has sought the direction of the apex court to the Union government to get a copy of the Senate Committee report that was the basis of the English-daily's report and present it before the judiciary.

See also: DTE rewind: FDI in India 




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