After retail, Mamata Banerjee eyes pension bill

Trinamool Congress Chief Mamata Banerjee during her press conference at her residence in Kolkata. Special: Tata-Singur rowAfter stalling the rollout of upto 51% foreign direct investment in multi-brand retail, key UPA partner Trinamool Congress is keeping alliance managers guessing on another important issue - the Pension Fund Regulatory and Development Authority (PFRDA) Bill.

Among other things,

opponents contend that the bill fails to provide any assured return to subscribers.

Trinamool Congress parliamentary party leader and union minister Sudip Bandopadhyay told HT from Kolkata on Sunday, "Reforms in areas that affect common people are critical issues. In the case of the PFRDA Bill, our leader Mamata Banerjee has not yet decided if we will support it."

Another union minister from the party, Saugata Roy, told HT: "As it relates to lifetime savings of common people, we have certain reservations about it."

The Congress, however, did not seem perturbed.

"If our allies have any apprehensions, we will definitely talk to them and sort out the issues. This is a key bill," said a Congress minister.

While the Centre sees the PFRDA as a major reform-related legislation and is keen to pass it during the winter session of Parliament, the Left parties have already raised their red flags.

While the row over FDI in retail stalled Parliament all of last week, the CPI-M's trade union wing, CITU, led a delegation to meet Prime Minister Manmohan Singh to ask for drastic changes in the PFRDA Bill, including a provision for minimum assured return for investors.

The union cabinet recently approved the PFRDA Bill but ignored the recommendation of Parliament's standing committee on finance to keep a 26% FDI cap within the legislation.

While the UPA managers want to keep the FDI limit out of the law to allow changes in it through executive orders, the proposed legislation has also irked a section of the BJP.

The CPI-M's Basudeb Acharia told HT, "We are trying to garner support from other political parties against the PFRDA Bill. We will force voting on the bill if the government tries to pass it in this session."

Govt on the mat after putting retail reform on hold

The government will have to pay the price for putting on hold plans to open up the country's $450 billion retail industry to foreign supermarkets. It will be defensive before Parliament, which meets again on Wednesday, and embarrassed before its supporters. The decision to hold back the reform decision in face of vehement of protests by it rivals and allies has put a question mark on whether Prime Minister Manmohan Singh can implement bold decisions. The government was supposed to signal investors and India watchers that it had not been paralysed because of a string of corruption scandals.

The government had been battling the Opposition in Parliament over the reform decision but West Bengal chief Minister Mamata Banerjee punctured any plan it had. The government was likely to release an official statement regarding the issue on Monday.

Analysts and business leaders slammed the Congress party for potentially bungling a crucial policy change that has been a decade in the making, and bemoaned the weak leadership of Prime Minister Manmohan Singh in the face of a parliamentary revolt.

"It makes the position of Manmohan Singh even more weak. Clearly the man carries no authority," said Arvind Singhal, founder of Technopak Advisors, a New Delhi-based consulting company.

He said India's lack of leadership was eroding much-needed investment, from domestic businesses as well as foreign. "The impact on investors will be very negative in terms of confidence," he said. "We need FDI, but India needs significantly more investment from within."

Opposition to the measure was "to the detriment of the vast majority," wrote Ashok Ganguly, former chairman of Hindustan Unilever and Deepak Parekh, chairman of Housing Development Finance Corp, in an open letter described as "a call to the saner sections of Corporate India to come out and strongly support progressive measures."

Shares in Pantaloon, whose Big Bazaar supermarket chain is seen by sector analysts as the number one tie-up target for a foreign supermarket, fell as much as 11% in early trade on Monday.

Shares in Shopper's Stop dropped over 9 percent, while Trent, the retail arm of the Tata Group conglomerate which already has an association with UK giant Tesco, saw its stock slide as much as 4%.

The reform, as it was first presented, would allow global chains like Wal-Mart, Tesco Plc and Carrefour into the chaotic retail sector, and is seen improving supply-chains and cold-storage, and helping to tackle stubbornly-high inflation.

Maya blames Rahul for FDI in retail sector

 UP chief minister Mayawati addresses a press conference in Lucknow.In poll-bound Uttar Pradesh, chief minister Mayawati blasted Congress general secretary Rahul Gandhi on Saturday over the centre's move to allow Foreign Direct Investment (FDI) in the retail sector. Alleging that the UPA government's decision was taken to benefit the companies of foreign friends of Gandhi, the Bahujan Samaj Party (BSP) chief said her government would not allow it in the state.

"In a bid to benefit foreign companies and to make the country a slave on the lines of the East India Company, the Centre has decided to hand over the country's economy to companies like Walmart," said Mayawati at a press conference. She said the company would bring cheap goods from China to sell here and that would lead to closure of small businesses.

The CM shot off a letter on the issue to Prime Minister Manmohan Singh on Saturday.

She demanded that the decision be rolled back immediately, failing which, she threatened to launch an agitation. Mayawati said the BSP would stall the functioning of the Lok Sabha if the Centre did not reverse the decision. The BSP has 20 MPs and extends outside support to the UPA government.

Evading a query on whether she would withdraw support to the UPA government, Mayawati said appropriate decision would be taken at the right moment. She said the bill had so far not been tabled in the House and only the cabinet had cleared it.

Hitting out at Gandhi, who is touring the state in the run-up to the assembly polls, Mayawati said the "Congress yuvraj" was "resorting to theatrics to bring his party to power".

She said, Gandhi was brought up and educated in a foreign country, and so his mindset was also that of a foreigner. "Whenever he comes to UP, he brings along his foreign friends on leisure trips and entertains them by taking them to the huts of poor people, making a mockery of their poverty," she alleged.

Cabinet likely to approve FDI in multi-brand retail tomorrow

The government is likely to approve 51 per cent foreign direct investment (FDI) in multi-brand retail tomorrow, a  decision that will allow global mega chains like Walmart, Tesco and Carrefour to open outlets in India.

Increasing the foreign investment (FDI) ceiling to 100 per cent from the present 51 per cent in single-brand retail is also on the agenda of the Union Cabinet meeting  scheduled for tomorrow, sources said.

Most ministries, including the finance and the textiles, are in favour of the industry ministry's proposal to open the politically sensitive sector to foreign players and the Cabinet will take a final call, they said.

Earlier, a panel headed by Cabinet Secretary Ajit Kumar Seth had recommended 51 per cent FDI in multi-brand retail with certain riders, like minimum investment of $100 million and local sourcing.     

The decision on the issue is pending for over two years as Opposition parties are against foreign investment in this sector. The $600-billion segment is dominated by small kirana (mom & pop) shops.

The Opposition has expressed concerns that allowing majors  global retailers would lead to unemployment among the unorganised sector.

The government had opened the single-brand retail for FDI  way back in 2006 and ever since 60 foreign players have entered the country in joint venture with local firms. Several global retailers are waiting in the wings to  enter India's multi-brand retail segment.