Wednesday, 5 December 2012

UPA goverment survives motion on FDI

Dear all

The UPA government has won the motion against FDI and a big boost to Dr Manmohan Singh, and his new wave of economic reforms. The motion put forward by the strange combination of BJP and Left parties  was defeated in the floor of the house  by 35 votes . Thanks to the 43 member   BSP - SP combine abstaining from the voting

It is natural that any economic reforms bring with it an array of apprehension on its fallouts. It is this apprehension of the public that creates the muddled waters for the political party to fish in and exaggerate the fear.

Multi-brand retail entry into the 450 Billion dollar Retail segment in India is perceived to be a threat to the small scale kirana stores and farmers. Notwithstanding the  fact that the policy on FDI in multi brand retail has inbuilt clauses which safe guards this perceived threat and  is left to the state governments for implementation, the BJP has been the unprincipled  opponent to this move.

Well this note is not into putting up an argument on the subject but to bring to the attention of the readers to the fact that, policy making and politicking in India revolves around the interest factors of the affected elite. India as represented by its political parties are governed by the  oligarchy aptly caricatured as the three prowling fat cats-  Business houses, Rich farmers and the middle man traders-Among this class of the  Indian bourgeoisie , the middle men traders are the BJPs coffers who shall be the sufferers in case of multi brand retail entry into India. With the retail chains resorting to direct purchase, transportation and storage and  by usage of  technologically driven logistic management tools, added to the benefits of economics of scale, the per unit cost is bound to minimize . This may result in the end of speculation as a tool for price management, there by hitting the trader in his underbelly.

As BJP has a major trader representation, this section is the hidden critic of the policy prompting them to move a motion against the bill which has now been defeated.

It is important for us to read this message between the line and conclude that good economics is always not good politics:


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