PRIME Minister Manmohan Singh awoke from his deep apparent slumber to put at stake his government for a cause that has little to do with the welfare of the people of India. So far he was blaming coalition compulsions for not doing anything, now on US diktat he has thrown to winds all that is called coalition dharma. Nobody except himself, is convinced of the need for retail FDI. His own party governments are opposing it, except a few.
Unilaterally he announced the policy of allowing 51 per cent FDI (Foreign Direct Investment) in the multi-brand retail sector. The decision had been held in abeyance for months now as several allies in the UPA and the opposition parties, and most state governments had been opposed to opening the Indian consumer market for players from abroad.
There is a reason behind the prime minister’s stubbornness on the issue — the American Presidential elections. The FDI cap in Indian market has become an issue in the election campaign in the US with the opposition party charging Obama with allowing losing American jobs to Asians while the large Indian middle-class buyers’ market had been restricted to foreign companies.
Manmohan Singh was also stung by the series of articles in foreign journals describing him of being an ’under achiever’ and a pet of Sonia Gandhi. The Prime Minister has been assiduously cultivating his image outside India, offering and announcing millions of dollars in aid to all and sundry country. In the latest he pledged $ 10 million to Palestine, largely seen as a terror state. He has continually played to the international gallery — read the US — be it on terrorism, economy or India’s relations with Pakistan.
After a brief honeymoon, Manmohan Singh has lived with a lot of disfavour in India. The economy of the country has been on a downslide over the years of UPA rule, both I and II. The much-touted ‘economist’ tag of the Prime Minister has not helped the country much. In fact, Manmohan Singh had filled the PMO, and the Planning Commission with hand-picked men who all shared the common heritage of overseas jobs in international financial institutions.
The UPA government is counting FDI in retail as part of reform. The proponents of the policy are making tall claims that the international companies would set up shops here that would help the farmer, the consumer and generate local employment. These are all projections in the air without any statistics to back them up. The least the government and FDI supporters could do is to give an idea on the number of proposals pending and the amount of money involved. At a time when the West is facing acute recession and capital is flying from China and India to those cash-starved economies, it is a matter of intelligent guess who would come with huge investments. It is here that the timing of Manmohan Singh government’s announcement on the issue, relating it to the US elections gain credence. Informed observers feel that the FDI move could result in Indian money, stashed abroad being routed through this to plough back legal profits.
Also, combined with diesel price hike and LPG subsidy reduction, the entire political debate in India has shifted away from the Coalgate, the Civil Aviation sell-out and the Airports scam. Till the other day, daily one minister’s name was cropping up in the media for getting coal mines by foul means. In one stroke, Manmohan Singh has killed several birds. He has pleased his foreign masters, he has distracted the opposition ire, foxed the Congress party into supporting him a little longer and won favours for the corporate class.
It may be recalled that the one other occasion when Manmohan Singh spoke up was in the nuclear deal. Then too he was willing to put at stake his government, by taking an aggressive posture and pulled it off. That decision too came at a time when there was a muffled talk going on in the Congress circles about his impending retirement.
This time also, the coterie of the Congress president Sonia Gandhi had started spreading rumours on the removal of Manmohan Singh. It is also pertinent to note that Sonia Gandhi and her hand-picked NAC have been advocating more social and financial doles and FDI in retail is a far cry from that. But the Congress party could do little but fall in line with the Prime Minister, given the foreign interests involved.
Nobody believes that the UPA government is going to fall. With the Mayawatis and Mulayam Singhs for ever willing to support the tottering UPA, Mamata may have done a favour to the UPA. It can now go on an un-obstructed spree of ill-advised economic decisions with long term implications for Indian sovereignty and the wellbeing of the people. The reform farce has begun once again.