New Delhi, Oct. 21: The Left has given up the battle to stop the increase in the foreign investment limit in telecom as a lost cause, but is concentrating its fire on preventing multinational retail chains like Wal-Mart to do business in India.
The first meeting of the coordination committee of the ruling United Progressive Alliance with the Left next Thursday after a three-month gap will be held in a contentious atmosphere.
First, before the meeting the Manmohan Singh government yesterday announced raising the foreign investment limit in telecom from 49 to 74 per cent. Second, amid signs that the Centre is also moving towards foreign investment in retail, Left leaders are warming their ammunition.
CPM general secretary Prakash Karat said: “The government has already taken a decision (on telecom). We made our opposition clear. Notes were exchanged between us and the government.” It would seem this battle is over.
Much as the Left tries to distance the economic reforms it is opposing at the Centre from the industry-stimulating policies being pursued by its government in Bengal, it is hard not to notice the link between the battles in Delhi and Calcutta.
Mamata Banerjee opposes Indonesian Benny Santoso’s investments and the CPM resists US retail giant Wal-Mart’s entry.
A Wal-Mart team, incidentally, met Buddhadeb Bhattacharjee yesterday, drawing the comment from the chief minister: “It (for Wal-Mart’s proposal to set up a chain of stores in Bengal to be acceptable) is bound to take time.”
The Left has come a long way from the days when foreign capital was like a pariah, but has travelled slowly. It’s also true that its relations with the UPA government have been based on give and take.
While the Centre dropped the idea of divestment from Bhel at the Left’s instance, it has not heeded the opposition to raising the telecom foreign investment limit.
Left leaders will go to the coordination committee meeting armed with a note against the government’s arguments for foreign entry in retail.
For the time being, the CPM is firmly opposed to any investment, but has left an escape route open. A top Left leader said they were not against foreign investment in wholesale but did not want it in retail trade.
“Multinational retail chains have been lobbying hard. This was evident during the visit of the Wal-Mart CEO to India in May. The Left parties, however, believe that allowing FDI in retail trade would have a negative impact on the already grim domestic employment scenario,” says the Left note.
The Left’s central leadership is mobilising support. It is in touch with the apex association of traders in Maharashtra. It has advised the association to organise a national seminar to mount pressure on the Centre.
Traders’ association president Mohan Gunani said they no longer trusted the BJP which used to be their traditional ally. “We support the Left because they have been consistent in their stand on the issue,” he said.