‘It has prohibited FDI in too many sectors’
Noting that India has prohibited foreign investments in too many sectors such as retail, U.S. President Barack Obama on Sunday cited concerns over the deteriorating investment climate in that country to endorse another “wave” of economic reforms.
Still sounding positive about the Indian economy, “which continues to grow at an impressive rate,” he said that to some extent, India’s slower growth was a reflection of the larger slowdown in the global economy.
In an interview to PTI in Washington, Mr. Obama was careful not to be directly critical of the negative investment climate in India but cited the concerns of the American business community to make his point.
Many in the American business community, “one of the great champions of the U.S.-India partnership,” had expressed concerns that the investment climate in India was deteriorating. “They tell us it is still too hard to invest in India. In too many sectors, such as retail, India limits or prohibits the foreign investment that is necessary to create jobs in both our countries, and which is necessary for India to continue to grow.”
Refraining from prescribing any solutions to India’s economic difficulties, the President said: “It is not the place of the United States to tell other nations, including India, how to chart its economic future. That is for Indians to decide.”
Mr. Obama noted that “there appears to be a growing consensus in India that the time may be right for another wave of economic reforms to make the country more competitive in the global economy.”
Kashmir issue
Mr. Obama ruled out any solution from “outside” to the Kashmir issue.
He underlined that disputes between India and Pakistan could be resolved only by the two countries themselves.
Welcoming the India-Pakistan dialogue process, he said: “It is not the place of any nation, including the United States, to try to impose solutions from outside.”
Keywords: U.S.-India ties, bilateral relations, President Barack Obama, Indian economy, global economy, economic growth, economic reforms
Mr. Ramprasad, Ms. Indira & others who oppose FDI: (1/2)
I agree that Walmart and American retailers of the same ilk have caused collateral
damage to small businesses in the US would probably export that same warped
model to India. Nonetheless, I am against opposing all FDI inflows in general - that
would be counter-productive, we would be in violation of our international
obligations. And invoking the East India Company’s record in India and
generalising it to all investments is economic claptrap and sheer jingoism.
India is a member of the World Trade Organisation (WTO) and trade related
decisions, need to be in conformity with what India has signed up to. Additionally,
Indian firms themselves use FDI in foreign markets cf. Tata Motors, Mittal Steel,
INFOSYS, Bharti, Godrej etc. Tata has indeed purchased the iconic UK automaker
Jaguar.
Mr. Ramprasad: Should Indian outbound FDI be counted as neo-colonialism and
banned? Surely, the Tatas & INFOSYSes of this world would not agree.
Mr. Ramprasad, Ms. Indira & others who oppose FDI: (2/2)
India demands the right to export its services, goods and capital whilst closing its
domestic markets to factor flows, hereunder capital. Any US administration would
demand reciprocity - tie Indian access to US markets to a reciprocal US access to
certain Indian markets - quid pro quo.
Indian firms have thrived behind protective tariff barriers - despite selling shoddy
products. Lack of competition has resulted in oligopolies and highly in-efficient
local industries that have fleeced the Indian consumer, cf. the duopoly in the car
industry prior to 90s liberalisation. Indeed, I will posit that after independence,
industries that emerged as a result of the nexus between crony capitalism and
corrupt politicians have done even more damage to the country than what the East
India Company did.
FDI in the retail sector has the potential to improve the lot of the consumer & the
producer - although a WalMart may perhaps not do that.
Once businesses like Walmart and Tesco get a foothold in India, they will adopt a very broad definition of retailing. In Britain Tesco sells petrol, insurance,has banking facilities,has in-store pharmacies,opticians,etc. Every one who has a presence on commercial streets will eventually be threatened,whether they be solicitors,insurance agents,bankers,opticians,doctors,pharmacists, bakers or traders.Once walmart and the like are allowed into India,it will be almost impossible to reverse the laws.These companies will be able to do what they like due to their deep pockets.They will also interfere in politics and with their deep pockets, they will be able to persuade politicians to change laws to suit them.As Ramprasad in his letter says ,India will become a neocolony.If the Indian government tries to let these giants in , every one who has a presence in commercial centres, be they professionals or traders , should raise their voice in protest because they will all be affected.
Its not the time to get touchy about who said what and who dictated what. The issues that Mr President pointed out, India and its (so called) leaders have known for ages. The question is what has been done to improve the economy of the country? Its time for being positive not taking the criticism in a negative light but working together to get some results. Just talk talk talk and empty promises don't hold any water anymore. I hope the Indian leaders realize that sooner than later. They can still take their own decisions, as long as they do something to make things better in the country.
Most of the people in India feel FDI in retail marketing will bring in disaster to this country which is not true but a conservative stance. But then what Reliance & More stores, Big Bazar shops and Malls doing these days? If not today, tomorrow we as go for these changes of the free world market including nuclear energy for a better future.
Obama should mind his own business.
FDI is neo-colonialism. The colonialism we have seen in 19th and 20th
century is not possible today. History tells us how east india company
entered india in the disguise of business and ruled our country. In neo-
colonialism they may not rule the country but they influence the policies and government.
The public lecturing to India how to go about running her affairs is not the way to treat a partner, a Strategic Partner at that. This is cheap politicking leading to the presidential elections. Partnerships require mutual respect; India will do her part.
India should never allow foreign investments in retail.
If it did, the the case would be same like the english had sold our raw material back to us in the form of finished goods at a staggeringly higher price.
And other important point to be noted is our quality produce will be exported to this foreigh country and people of India would have to settle with leftover cheap goods. And obviously there are millions who make a living on retail business. Now they would have to work as cheap labour to this foreign country who is asking Inida to allow foreigh invesments in retail.
Unless we have another Shree PV Narashima Rao, another wave of economical reforms will not be east with the kind of political leadership we have in the current day. Sad but the forgotten great man did what we are today. After Shree Jawarharlal Nehru-Shree Indira Era Shree P V Narashima Rao laid a sound economical foundation bringing Manmohan Jee on board (then Reserve Bank Chief) and Shree A B Vajpayee taking the same stride - put us on board. Now it's only looting the nation scams and scams.
One thing Mr. Obama is right about, is the fact that Indian Economy needs a reform. The fact that FDI is restricted in several verticals, may be is stopping the country from economic development. Its time now to act on these terms and start making the economy strong. Even the S&P rating last quarter was against the economy of India. Its high time we need to think on that.
Barack Obama has no right to goad us towards the so-called "reforms". For Mr. Obama, who is widely believed in his own country to be their most socialist President, to be championing pro-business causes in our country is completely hypocritical.
Respected Mr. President of U.S., Please see the constituion of India, it is a Socialist Democratic not capitalist democratic like you, policies are made for society here not for capitalists like in your U.S.
Thanks Mr. Obama for saying what is known for years and by all concerned. Hopefully, now that you have said the same EXPRESSLY, our feeble legislatures and their supine head will have some reason to bring this next wave rather than politiking over it.
Let the American President looks his back first. Without seeing his
back, what is happening in his own country he is talking about
India. American Economy is doldrums. Unemployment is increasing in
america. There is a doubt whether Obama will return again in the
coming elections. His talks about India is a humour. He is a joker.
Everybody in India would laugh at him if he continues to talk like
this. But his reference about Kashmir is sane. India would not
allow third party interference in Kashmir.
If another round of reform implies working as slaves of corporate America then we are better off without those reforms & without that elusive 9% growth. If 9% growth implies high profit for corporate America while impoverishing our poor & forcibly displacing poor farmers & tribals to benefit the corporates then we are better OFFF without it. I dont want corporate salaries in millions of Rupees for myself or my children if that means silently watching the genocide of my poor countrymen for the profit of corporate America. India will surely get ahead of the rest based on innovation & research rather than through open market policy which means surrendering our sovereignity & supreme national interest (interest of poorest Indian's) for profit of corporate America.
As should every president of any country, Obama puts his country
first. All his comments and actions should be seen through that glass.
India does not have a dearth of savings. We have one of the best
retail savings rate. The problem is more of government crowding out
private sector and making it too costly for the private sector to
avail finance. At times this difference is large - like double the
cost as in China. Hence the solution is not allowing FDI. It would be
for the Govt to sell its stake in public sector companies and leave
business to business and concentrate on governing the country and
legislating sound laws.
Obama is president of USA. He is not PM of India. How come he feels he can make statements about India? India does not make statements about what USA should or should not do! Why does Obama and his administration think they have the right to tell India what to do?
I wonder what political strategy this serves, other than mis-information, misguidance and above all jingoism, all targeted to garner votes from ill-informed, suffering, jobless American voters. He should instead by looking at USA jobs creation, by allowing more liberty to foreigners to setup businesses offering jobs to Americans. Everyone knows, by dictating others you do not get respect, you only get booed. This is where Obama is immature.
Mr Obama wants India to be the Happy Hunting Ground for USA,
But refuses to be Bangalored. Wants to rob the petty traders making a
living out of hard work. He refuses to part with technology that will
help starving millions around the world. Wants to monopolise natural
resources for the exclusive benefit of Americans, ever willing to bomb
those resisting him, to the stone age. Will emit more and more green
house gases and make up by buying carbon credits, at the same time
impose restrictions on India and China.
"It is not the place of any nation, including the United States, to try
to impose solutions from outside.”
Yes they can only impose sanctions! Is it?
Obama's non interference is appreciated, be it our economic decisions or
political (considering he goes by what he says).
How is United States sanctions on Iran justified?
what a pity. US political leaders attacking foreign countries to get votes. Political leaders are fooling people in that country.
Elections means they have to raise their issues and parties give their plans to solve them. Since decades US political drama is wandering around foreign countries. They ignored their issues.
India buckled to western pressure and purchased billions of dollars worth of weapons that it
neither needs nor can afford. India bent to western pressure to limit Iranian oil and the
Indian public suffered the high cost of importing oil from other sources. India was almost
swayed by Israeli pressure to support Israel's immoral stance against Palestinian Human
Rights at the UN. If India succumbs to western pressure to allow unlimited FDIs, India will
become another Pakistan, where the PM is appointed and dismissed by western dictates.
India needs to be independent and non-aligned for India's future political and economic
security.
First of all India needs a strong wave (mind blowing) reform to its Politician, Political
system and public knowledge of pro and cons of our Politician (not simply voting
only) ................!!
If getting chains like WalMart was so profitable, I don't think people
in the US themselves had been protesting against big box stores. I
live in Boston and I have seen local communities blocking a proposal
to bring WalMart to their area. There are books, documentaries and
scores of reports devoted to the topic that big box stores stifle the
growth of an area, city and ultimately the country.
I am not against FDI, but whether to allow or not, should be India's
decision and no one should force or pressure her into doing anything.
Mr President, we agree with you: “It is not the place of the United
States to tell other nations, including India, how to chart its
economic future. That is for Indians to decide.” AND “It is not the
place of any nation, including the United States, to try to impose
solutions from outside.” Our citizens and elected politicians will
decide which economic reforms we should opt for in the best interests
of India and Indians.
And economic sense may dictate that the priority areas ought to be
those improving India's “productive capacity” (including
infrastructure) and NOT those areas sucking in imports for private
consumption, or worse - decimating what little indigenous production /
business activity (creating employment and income) we currently have.
We should appreciate it if you would help us "catch a fish", not just
eat "tinned fish" imported from abroad with our precious foreign
exchange. We know, as a friend, you will understand and persuade your
countrymen.
Yes, we do need another set of reforms. But do we have the political will to bring in those reforms?
When President Obama says India needs to open its retail markets he must be referring to allowing America's big box stores such as Walmart.
There are few actual retailers in the United States. They are simply distributors for Chinese goods. I doubt their presence in India would serve either country well.
India does not require Obama to tell if it needs another reform or
not. India is in a position to make that judgement based on its
environment, economy, production and talent. Indian reform came well
before Obama and will continue even after Obama, if need be. What
India does not need is the opportunistic comments and suggestions by
Obama. Otherwise how can one explain his duplicity of blaming India
for outsourcing ills and at the same time seeking Indian cooperation
in expanding American business in India. Obama, please fix the
situation in US first before advising other nations.
Obama is talking about interest of american companies at the cost
of millions of middle and lower class Indians. People of India
should stand against these elements and their agents in Indian
Government.
US will always try to be nice, because we are not creator of deficit for them like China. For every 1 American there are 6 Indians. And with US capitalism and Indian consumerism will help them to have a worry free life. We have business people and politician put a straw and suck up all our hard worked earnings. And business and politicians are really good puppets to play with. That is the oppotunity that US is looking for.
US companies may come and compete in the Indian markets but there
should be some rules like:
1)-They can come and work in areas where we need technical guidance
like space, communication, navigation, and some aspects of defense,
but not retail.
2)-Everything should be 100% made in India or 100% made in USA (not
just made in china or any other country), that means they could invest
and build capacity and sell stuff, if they in excess they can export
also.
3)-they will have to reinvest 65% of thier profit back in India for
atleast 20years and then reinvestment can be reduced up to 50%, but
never less than that under any circumstances.
4)-building infrastructure, helping in waste management, power
generation, nature conversion, and super medical research facilities
are also vital areas to target for cooperation and business.
5)- They will have to work like govt to govt agencies not private
sectors who possess well enough capacities on their own.
thanks
over the weekend, looks like Obama has become the Prime Minister of
India. I wonder whether he is still holding on to his American President
job. Tough on him if he wants to be both. Can some one pls advice him
against this.
President Obama is a great orator,he can turn the situation to his best interest through his speech but we as Indians should not be carried by these talks.We need to understand few things here,he is batting for Walmart and Target to get into India,but allowing these giant retailers without developing local businesses will be a death trap.Revisiting events when we allowed Pepsi and Coke to enter India we can understand our local drinks are gobbled up(Limca,Thumbs Up etc).We don't want a repeat of that by allowing these retail mammoths.In fact Walmart and Target are not allowed in many communities in the US as they destroy small and local business.There are cities that has asked to leave walmart though they had stores for many years.All these inflation and price increases happening is Market Manipulation of these american banks and organizations forge trades.One recent example is the LIBOR and Trading loss at JP Morgan.We people should boycott if Govt allows against our interest.
President Obama's take on Indo-US relations is correct. There is one
aspect to which he referred in the following words:
"The President pointed out that India had lifted tens of millions of people out of poverty to create one of the world’s largest middle classes". How true.
It means now there is a thinking class of people whom nobody can take for granted at the hustings and in legislatures.
Leaders of India: do what's right for India. Do not listen to someone who has a failed track
record, especially on the economy, and whose ever utterance and act is solely for his own
reelection.
it's not Obama but US multinationals dictating to India...ironically
these 'reforms' are portrayed as solution to misery and poverty...but
in reality these are tools to further skew concentration of money in
few hands at the cost of natural resources and cultural wealth of this
country... the very idea of 'development' must emerge from local
genius.. recently so called 'market sentiments' surged when
electricity tarrifs were hiked in Delhi... are markets against common
people?.. it seems so.. and our whole gov. machinery is dedicated on
these reforms and care about market sentiments not a common man
sentiments....some high offices of current gov are working for
'outsiders' not for us.... implementing GAAR was first step towards
curbing black money ..media cries so much abt black money..but not on
postponing GAAR.. why?.... changing gov. will not suffice.. we need a
revolution.
We must take Obama's comments with a pinch of salt...he has massive problems to solve concerning the American economy and needs to create jobs for Americans, but letting Walmart destroy Indian retail is not the solution...seems like Walmart has found a new ally in Obama after Hillary Clinton, but what's best for America may not be best for India, and vice versa
India is also trying well for Good balance in international economy
system but we have our own domestic challenges. where we have to
fight at the very first for the well being of a common man. As Mr.
Obama told about retail market's and remarked our situation &
limitations,but we can't agree with him fully b'coz we have a large
population who is still based on his daily livelihood sale besides
road corner's,they have lots of challenges around them. we are
trying inclusive growth with vertical and horizontal aspects.So we
shall help as we can for world economy.
Sorry to be critical but this just confirms to whom our UPA is working for? In the last
decade India has lost more than a quarter million to farm suicides, despite the
attempts by UPA to bring down the numbers by cooking the incidents. There was
not US then. In India, only the rich and powerful becoming rich and powerful. I
would like to give the names of those industrialists who were born, brought up and
reached pinnacles from a poor background, without using shadowy tactics or
exploiting the other poor. Moreover, US is the one which restricted visa and created
constraints for INdian companies, now it wants India to free the market. The direct
consequence, market imbalance in US' favor. Indians then would eat the stupid
processed & GM foods, many would be in the streets because of loss of jobs. If
Indians still doesn't wakeup, stand and make their Govt. to work for them, Indians
are as good as dead and it'd be honorable to commit suicide than to live for the
benefit of these people...
Irrespective of what mr.Obama says India should first consolidate its economy utilising idle surplus capital lying with big industrial houses.Investment in riverine irrigation projects, infrastructure, manufacturing sectors[both for internal consumption and for export will strengthen the economy will generate employment and create national assets.These ,if implemented,will also help India stand on a firmer ground economically.Needless to say that Indian entrepreneurs are efficient enough to take care of the retail chains themselves.
The FDI in retail will bring more poverty and destitution to already poor 500 million Indians living on less than Rs 80 a day. It will rob small business and retail enterprise of their livelihood.The nexus of big corporate,bankers and right wing politicians dominating the world economic scene is the cause of global economic woes. Mr Obama is looking for economic recovery elsewhere that may help his failed efforts in the USA due to Republican controlled Congress.The Federal Reserve whose job is to stabilize price and ensure full employment is failing being intimated by the Republican Congress not to act that may help Obama.Since 1950 the mantra that the growth will be evenly distributed to ameliorate povery has not worked.In India itself the 10% growth has made more not less poverty,unemployment and hunger.Globalisation is not the solution for India and the free market is economic 'cannibalism' which poor is facing with unaffordable tution in education and high cost of health care.
Walmart and the like will all come to India sooner or later, the US
should worry about other issues that are burning more. Like its
shrinking revenues and increasing debts, industrial decline and a
Zionist-influenced foreign policy. Obama is a good story-teller, though.
In multi brand retail malls today in USA like Walmart or Kroger or others,70 per cent of the
items are made in China. How can Obama or our Indian politicians say that it will create
more jobs in India? Obama still does not realize the cause of unemployment in USA as
outsourcing the manufacturing to China in the name of competitiveness. It hurts India which
can definitely manufacture at low cost with right labor policies and investment in
infrastructure. Our economist PM atleast must be aware that multi-brand retail will benefit
China and USA and not Indian industry or employment. Of course Americans may like to
pull India also into their mess with the collusion of our corrupt politicians and super
corporates like Ambanis,Mittals, Tatas besides neo-politico corporates like Marans,
JaganReddy, Gali brothers and others who are flush with money due to crony-capitalist
policies launched by the UPA I headed by MMS and Sonia.
India has purchased billions of dollars of defense equipment that it neither needs nor can
afford due to western pressure. India succumbed to western pressure as it limited its
financially sensible imports of Iranian oil. India is pressured by Israel to support Israel's
immoral stance at the UN at the expense of India's correct support for Palestinian human
rights. India is alienating many of it's longstanding friendly nations and allies as it plunges
headlong into the capitalistic cabal. India's arm is being twisted by US to let in more FDI.
India can give up any semblance of being an independent nation and become another
Pakistan where the Prime Minister can be appointed or removed any time by special
interest summons from the west. India needs to pursue an independent non-aligned policy
for it's future economic and political security,
Yes, he is correct by saying India should make difficult reforms. However, India should make reforms that helps in the development of India and not to please other countries. How about this Obama: Why don't you ask the American countries to reduce the price of generic cancer drugs sold in poor countries and then we shall discuss FDI. You can not have double standards anymore.
Hi,
obamaJI , we Indians do NOT want FDI in multibrand retail.
We know you are playing to the gallery and trying to please your Zionist masters .
we don’t want to be a slave nation again.
We are free and will never be a banana republic, even if Sonia Gandhi , and her sycophants like anand sharma , kapil sibal, ambika soni etc who are more loyal to the queen bee than to their motherland are pushing for it desperately ..
India being a developing nation, its govt has to adopt the role of welfare state where only the economic growth can not be equated to overall development of the nation. As the trickle down effect of economic growth can not ensure the development of all sections of the society. With about 40 percent of India's population still living below poverty line even after 20 years of globalization, privatization and liberalization reforms initiated in early 1990s, effectiveness of the trickle down effect theory and Kuznet's relation between economic development and equitable distribution of income are under suspicion.
In this context the role of govt,as Keynesians would advocate,extends and onus falls on it to ensure equitable development through the developmental policies and schemes targeted at the eradication of poverty for large masses of India. Without the development of villages and their empowerment the islands of prosperity created by private sector defeat the purpose of welfare state
More foreign investment means more foreign greed to milk the consumer in India. India's slowdown is because of wrong priorities, greed, crony-capitalism and corruption. The root cause of all this is lack of character and direction - very much symbolized by the ruling party's bankruptcy of leadership, statesmanship and character, and deep involvement and entanglement in corruption. Once we set these things right, other things, will by themselves, begin to fall in place for our bright future.
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