PM defies calls for rollback of FDI in retail

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Prime Minister Manmohan Singh on Tuesday said the government's decision to allow foreign equity in retail was not taken in a hurry but was a well considered policy that would benefit people by bringing in jobs and latest technology to farmers.

"We didn't take the decision hastily. We have thought a lot and firmly believe that this decision will benefit us a lot," said Manmohan Singh, addressing a rally of elected Youth Congress leaders here.

Manmohan Singh said he was confident that foreign direct investment in India's retail sector would benefit farmers as "this will help to bring latest technology to the agriculture sector, less wastage and more jobs".

The cabinet decision has triggered protests by opposition and key allies of the ruling United Progressive Alliance (UPA), who are demanding a rollback of the policy of approving 51 percent FDI in multi-brand retail and 100 percent in single brand retail.

This will allow foreign supermarkets to enter India and set up shop, they say.

The decision has led to a deadlock in parliament with opponents claiming that it would adversely affect small traders and farmers and eat up jobs in the country. But the prime minister sounded firm about the decision and has defied the calls to withdraw it.

"This will curb inflation and the common man can get daily essential commodities at lesser rates," he said, reading from a paper in Hindi.

He asked young leaders of the ruling Congress to help the government in sending a right message to the public about its intention behind the FDI in India.

Manmohan Singh flayed the opposition for opposing the key decision on economic reforms, saying they were disrupting parliament and blocking crucial legislations needed for India's economic prosperity.

He said the world economic situation was affected by the US and European crisis but expressed hope that India's inflation rate would fall sharply over the next few months.

"I am confident we will successfully face the global slowdown. I expect inflation will sharply decline in the next few months due to steps taken by the government," he said.

Manmohan Singh said the nation's economic growth needed some new legislations and amendments to the older ones. "We need parliament to work properly for this, but the opposition is not allowing it to happen," he said.

"We always believe that the differences should be debated, and if we are disrupting parliament we are doing injustice to the people who have elected us to parliament," he said.

He said the government was trying to end the parliament logjam, triggered by various issues, including inflation, demand for statehood for Telangana, and now the FDI controversy.

He said the government has put certain conditions in the FDI decision so that small and medium enterprises were not affected by the proposed foreign equity.

"There will be no coercion. The states which think it is not fruitful can choose not to allow foreign shops in their states," he said.