Commerce Ministry taking legal view on Delhi's U-turn on FDI
Jan 15 2014 , New Delhi
"The DIPP is in the process of taking views of the Law Ministry on the matter. It needs an expert and legal opinion as it is a complex issue. States which have agreed to implement the policy cannot easily roll back the decisions," a senior ministry official said.
In a major policy reversal, the AAP government wrote to the Centre to withdraw approval given by previous Congress government for FDI in multi-brand retailing in Delhi, saying the entry of global chains such as Walmart and Tesco in India would result in large-scale job losses.
Commerce and Industry Minister Anand Sharma has termed the Delhi government's decision as "irresponsible" and "ill-considered".
He has also raised the question that whether a minority government with outside support can reverse such decisions.
The central government permitted 51 per cent FDI in multi-brand retailing in September 2012 and left its implementation to the states.
As many as 12 states, mostly Congress-led, including Delhi and Rajasthan, agreed to allow global retailers to open supermarket chains. Other states include Maharashtra, Karnataka and Andhra Pradesh.
Rajasthan, too, saw a change of government with the BJP coming to power after the November-December state assembly elections. It is still not clear what stand the BJP government in Rajasthan will take on the FDI policy. FDI in multi-brand retail had not evoked the expected response from global retailers.
So far, only one proposal from UK-based Tesco has been approved by the central government.