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India confirms suspension of retail reform | India confirms suspension of retail reform |
(40 minutes later) | |
India's parliament has resumed after the government confirmed that it was suspending a plan to open up the retail market to global supermarkets. | India's parliament has resumed after the government confirmed that it was suspending a plan to open up the retail market to global supermarkets. |
The decision has been suspended "till a consensus is developed through consultation among various stakeholders", a statement said. | |
The parliamentary session was deadlocked for two weeks after the opposition parties protested the move. | The parliamentary session was deadlocked for two weeks after the opposition parties protested the move. |
The decision to allow foreign chains into India has been fiercely opposed. | The decision to allow foreign chains into India has been fiercely opposed. |
Critics say the move will destroy millions of jobs and businesses in the small retail sector. | Critics say the move will destroy millions of jobs and businesses in the small retail sector. |
Supporters say it will widen consumer choice, reduce waste and improve security for farmers. | Supporters say it will widen consumer choice, reduce waste and improve security for farmers. |
Finance Minister Pranab Mukherjee told the parliament on Wednesday that the government would "take a decision [on retail reform] after a consensus is developed after consultations with all stakeholders". | |
The stakeholders include chief ministers of states and all the political parties, he said. | |
Mr Mukherjee hoped that the parliament would begin functioning "as only 10 days are left for the session to end". | |
'Virtual rollback' | |
Earlier on Wednesday, the government confirmed at an all-party meeting that the controversial retail reform was being put on hold. | |
"It is a virtual rollback. It is a victory for democratic forces," said Gurudas Dasgupta of the Communist Party of India (CPI) who attended the meeting. | |
However, Minister of Renewable Energy Farooq Abdullah said a decision on retail reform had only been suspended, and there had "been no rollback". | |
Analysts say the decision is a blow to the government's image, and wonder why it did not evolve a consensus before announcing the move. | |
"The prime minister's image and the government's image will be definitely dented," said Neerja Chowdhury, a senior journalist. | |
Business leaders have criticised the opposition to retail reform. | |
In an open letter, former Hindustan Unilever chairman Ashok Ganguly and Deepak Parekh, chairman of the Housing Development Finance Corporation, said opposing the reform was "to the detriment of the vast majority". | |
The government announced on 24 November it would allow 51% foreign ownership of multi-brand retail stores, allowing groups like Wal-Mart and Tesco to open stores. | The government announced on 24 November it would allow 51% foreign ownership of multi-brand retail stores, allowing groups like Wal-Mart and Tesco to open stores. |
Currently, foreign-owned multi-brand retail operators can only sell wholesale in India, not directly to customers. | Currently, foreign-owned multi-brand retail operators can only sell wholesale in India, not directly to customers. |