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Claiming Delhi needs jobs, Kejriwal scraps nod to FDI in retail

Arvind Kejriwal said the decision was taken to address the huge problem of unemployment in Delhi.

New Delhi | Updated: January 14, 2014 10:28 am
While Congress-ruled states had agreed to implement the policy, Delhi has become the first to change its mind. While Congress-ruled states had agreed to implement the policy, Delhi has become the first to change its mind.

Claiming that global experience showed FDI leads to job losses and that Delhi is not prepared for FDI, the two-week-old Aam Aadmi Party government in the capital Monday announced that it had withdrawn the approval given to FDI in multi-brand retail by the previous Congress government.

Chief Minister Arvind Kejriwal said the decision was taken to address the huge problem of unemployment in Delhi and that it had been communicated to the Union commerce and industries ministry through a letter on January 1.

The new CM also stressed that his party was not against FDI per se but that the decision on FDI “ought to be decided on sector to sector basis”. But the Centre said the Delhi government could not reverse this decision just like that.
“My first reaction is that states cannot just walk in or out of this commitment. Those which had accepted they will allow FDI under multi-brand retail had signed a legal agreement with us, based on which we had issued the notification,” Commerce Minister Anand Sharma told The Indian Express.

Sharma said he would have to check on the details with officials in the Department of Industrial Policy and Promotion “but that is how I see it at present”. Kejriwal said withdrawing FDI from multi-brand retail was part of the AAP manifesto. “Whatever information is available shows if there is FDI in retail, it improves consumer choices, however, experience worldwide shows that it leads to loss of jobs worldwide also,” Kejriwal said. Last year, the central government permitted 51 per cent FDI in multi-brand retail trading and left its implementation to the states. While Congress-ruled states had agreed to implement the policy, Delhi has become the first to change its mind.

“The data of the centre is not corroborated by the experience worldwide. Unemployment is a huge issue in Delhi presently and it came down to being a decision between addressing unemployment issues in the city and providing consumers with choices, and I chose the former,” Kejriwal said. “There is no conducive environment provided to the retail sector to start business. This sector faces so much corruption in every stage. In the next few days, I will hold a meeting with people from industries and traders to ask what kind of bottlenecks are faced by them and what can be done to generate wealth,” the CM said. “We are committed to creating an honest environment which is corruption-free and the anti-corruption helpline is a move towards this. With the proper environment expansion of retail trade is possible,” he said.

The letter from the commissioner of industries Amit Yadav to the DIPP secretary said: “The government of NCT of Delhi had extended its support to the government of India’s decision for liberalisation of foreign direct investment policy in multi-brand retail trade with certain suggestions. In this connection, I am directed to inform that government of NCT of Delhi has reviewed its earlier decision and it has been decided not to support foreign direct investment policy in multi-brand retail trade…In view of the above, the letter from Government of NCT of Delhi may be treated as withdrawn.”

Ruhi Bhasin

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    Bheja Fry
    Jan 14, 2014 at 6:57 am
    Bad decision. Totally political & devoid of any merit. FDI increases compeion and creates many new jobs as well. This should be the selling point instead of taking step backwards with an eye on upcoming Lok Sabha elections. Who is AK trying to Con!
    1. O
      Jan 13, 2014 at 7:08 pm
      Mr. Kejriwal, here's how economics works. FDI in retail will bring in,among other things,clean hygienic food which will encourage more people to eat out. Which means more restaurants ,more service sector jobs,savings on anti diarrhea drugs,lower prices for consumers,less food wastage,better quality milk without contamination..More canned food available for poor.Some jobs will be lost but there will be net increase in jobs. Socialistic system is a failed ideology.So, like "The Who" said, "we wont get fooled again."
      1. S
        Sudheer Deoli
        Jan 14, 2014 at 5:52 am
        In year 2oo6 Britain's Prime Minister Tony Blair asked for responsible Capitalism. well back then noted Historian Late.Eric Hobsbawm said that there is nothing such as responsible capitalism. Then he went on to say that profit and surplus are filthy words. Capitalism by its very nature is filthy. Today AAP will have to clear where do they stay. Because to me the biggest looming threat to world in the multinational corporate.
        1. d
          Jan 15, 2014 at 5:05 am
          This was one of the items in their manifesto (the word that has become meaningless for voters curtsey other parties).First time, some one is following his manifesto honestly.By the way, look at cong - Earlier in their reply they said that these issues are in executive domain (when they were given a chance to clear their stand). Now, they say that it can not be undone like this!Perhaps we deserve cong/BJP and the status quo.
          1. Dayanandan Padmanabhan
            Jan 14, 2014 at 2:09 am
            Well done..It is a good stand that the state govt. is not yet fit to accept F D I overlooking m unemployment. The C M does not deny F D I too.
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