Government wins FDI battle, says reforms on track

The UPA government Friday dealt a blow to the opposition by winning a Rajya Sabha vote on FDI in retail by 14 votes and declared that there was no stopping India's reform process.

In contrast to speculation that the government may lose the vote in the upper house, the victory proved pretty easy as the Samajwadi Party (SP) trooped out - like in the Lok Sabha Wednesday - while the Bahujan Samaj Party (BSP) voted for foreign direct investment (FDI) in multi-brand retail.

As a disappointed opposition claimed "moral victory" on the strength of the speeches made in the house over two days, Parliamentary Affairs Minister Kamal Nath said after the vote: "Our reforms are on track."

Commerce Minister Anand Sharma, the main speaker for the government on the contentious issue, took on the opposition after it said the FDI did not have the support of most MPs even if the final vote went in favour of the treasury benches.

"We challenge them," he said. "If we are a minority government, let them bring a no-confidence motion (against us)."

The opposition-backed motion against FDI in retail got 109 votes while the government managed 123. But officials said there was some confusion on the final voting figures although the government had won.

Minutes before the voting process began, all nine SP members walked out, bailing out the ruling United Progressive Alliance (UPA) - for the second time in three days.

On Thursday, day one of the debate in the Rajya Sabha, Mayawati took on the Bharatiya Janata Party (BJP) and declared triumphantly that 15 MPs of her BSP would vote with the UPA government.

Both the BSP and SP provide legislative support to the Congress-led government.

The government move to provide 51 percent foreign equity in multi-brand retail has long been a contentious issue, stalling almost the entire first two weeks of the winter session of parliament.

With Friday's vote, global names like Carrefour, Tesco and Wal-Mart can set up stores in India.

Earlier, addressing the house during the debate, Anand Sharma denied accusations that the FDI decision was a unilateral one and said the government had talked "to everyone, farmers, traders, consumers, states".

Some sparks flew during the Rajya Sabha debate, with Sharma's reference to Rajya Sabha member N.K Singh kicking up a row and leading to an adjournment.

Sharma spoke about Singh having chaired a panel on FDI during the NDA rule. Singh was then principal secretary to prime minister Atal Bihari Vajpayee.

After the parliament defeat, Communist leader D. Raja accused the UPA government of "brazenly" identifying itself "with multinationals and then claims it is with aam admi". "The sense of the house is against FDI."

The AIADMK gave a "solemn assurance" that the next central government would reverse the FDI decision.

AIADMK leader V. Maitreyan, who moved the motion for the debate in the Rajya Sabha, said: "FDI will only be on paper and will not be implemented in states."

The Confederation of All India Traders (CAIT) announced a country-wide protest from Jan 1.

CAIT general secretary Praveen Khandelwal told IANS that the voting by certain parties in both houses of parliament was a result of "manipulative politics".