Hitting back at U.S. President Barak Obama for his remarks on India being slow on economic reforms and restrictive FDI policy, Union Commerce and Industry Minister, Anand Sharma on Monday said policy making or taking decisions was the sovereign right of the country and instead asked the U.S. to ``demonstrate’’ leadership in bringing down barriers and protectionism in trade.
``We have taken note of this observation. There is always a difference between perception and reality. India remains one of the most attractive destinations for foreign investors. Recent UNCTAD report has stated that India was among the top three FDI destinations; the Japanese Bank for International Cooperation’s (JBICs) recent report placed India at number two and in the long-term, they have put India at number one. There is another report from the Kearney Consultant, which again puts India at number two. Ernst & Young has also said that over 4/5th of the FDI in South Asia came into India. In the last three years, a series of steps in the FDI policy have been taken in most of the sectors by adopting a calibrated approach in following the path of economic reforms and liberalisation,’’ Mr. Sharma told reporters here.
However, Mr. Sharma said, there was always a scope for improvement. ``Looking at the global economy, U.S. is the largest economy. We would urge U.S. to demonstrate leadership, or to give leadership in bringing down barriers, encouraging capital flows and trade in the world, which is good for every economy. U.S. should lead the fight in the world against protectionism and take forward the stalled Doha development round of the WTO and bring them to a meaningful conclusion,’’ he added.
He said last year India received FDI in excess of $50 billion. It was more than 34 pc or 35 per cent higher than the previous years. “So why this perception, I fail to understand? If there has been a sharp fall in FDI, I can understand, if there is 34-35 pc increase, then there is something wrong with that perception, because facts speak otherwise,’’ he said.
The Commerce Minister said Mr. Obama has every right to convey what his perceptions are. But, the policy making is a sovereign decision and Indian FDI policy regime is investor-friendly. ``We have an abiding commitment to reforms. We are one of the most attractive destinations and we will continue to be. Decisions are taken after an inclusive process of consultations which my government believes in and accordingly at an appropriate time decisions, which serve the supreme national interest, are taken. They have been taken in the past and will be taken in future also,’’ Mr. Sharma said.
Mr. Obama in an interview to PTI on Sunday noted that India prohibits foreign investment in too many sectors such as retail and endorsed another wave of economic reforms. ``It is still too hard to invest in India. In too many sectors, such as retail, India limits or prohibits the foreign investment which is necessary for India to continue to grow,’’ the U.S. President had observed.
Meanwhile, the Polit Bureau of Communist Party of India (Marxist) has taken a strong objection to the remarks by Mr. Obama that India should open its doors to FDI in retail trade and other U.S. investments. ``The statement by Mr. Obama is a brazen attempt to pressure the UPA government to adopt such steps as opening of FDI in multi-brand retail,’’ a statement issued here said.
The CPI(M) said the UPA government should not succumb to this pressure. The CPI(M) urges the government not to open up retail trade in foreign supermarket chains, which will endanger the livelihoods of lakhs of small shopkeepers and traders, it added.
Keywords: U.S. President Barack Obama, Anand Sharma, FDI, sovereign rights, trade barriers
Anand Sharma is an old Gandhian. He is aware that the export of raw
materials from India and import of finished goods into this country
lead to a lot of unemployment, misery and starvation among the handloom
weavers of Dacca and Murshidabad. The plains of Bengal became white
with the bones of weavers. Later on, Mahatama Gandhi started his Khadi
Gramodyog and swadeshi movements to counter such trends. Our country is
inadequately organised for production.The number of small commercial
etablishments is much in excess of our requirements. But this keeps so
many people alive at a low level of existence. Large departmental
stores of multinational corporations are going to make small
shopkeepers and hawkers jobless. Their misery will compel many of
them to commit suicide. Let us encourage FDI in manufacturing.
The explanations which our Honorable ministers are making against
Barack Obama's perspective remarks seem to be very ironical. If we
closely examine what was said by US president, we could
easily infer that Barack Obama is talking about future growth here not
just looking or analyzing past glory which our country has already
achieved.
Although no one can interfere in our sovereignty, it is utmost right of
our country's policy makers to make such policies which could again
bring back stalling single digit economics growth to an impressive
double digit number.
Instead of talking or presenting past astonishing facts, our
intellectuals think tanks need to take some hard decisions regarding
FDI in retail, aviation and other beleaguered sectors where we need a
huge chunk of money.
Kudos to Anand Sharma for talking back. Why is it that the developing countries are always urged to open up their economy to the world, while the developed nations, particularly the US, fail to do so themselves. Moreoever, why do we constantly need to prove that we are an attractive FDI destination by persistantly loosening controls? Also, there is no evidence that liberalising the economy is a solution to all the economic problems. There is plenty of historical evidence to prove the contrary!
The explanations which our Honorable ministers are making against
Barack Obama's perspective remarks seem to be very ironical. If we
closely examine what was said by US incumbent presidents, we could
easily infer that Barack Obama is talking about future growth here not
just looking or analyzing past glory which our country has already
achieved.
Although no one can interfere in our sovereignty, it's utmost right of
our countries' policy makers to make such policies which could again
bring back stalling single digit economics growth to an impressive
double digit number.
Instead of talking or presenting past astonishing facts, our
intellectuals think tanks need to take some hard decisions regarding
FDI in retail, aviation and other beleaguered sectors where we need a
huge chunk of money.
Is there any evidence based argument to state that small retailers will be significantly affected by giant super-markets entering India, particularly taking into account that the Indian market largely operates an informal economy which may be affected by big supermarkets.
Why the hell is so much hue & cry against Obama's remarks? Have we not
invited US to invest in India? then if Obama is making a statement why
are we anguished? We should have been anguished over wide spread
Policy Paralysis. Had we never taken pride in having world's "Largest"
democracy? Then why we cann't listen to such adverse remark? Is it
negation of a brute reality? As a democratic nation, why can we not
bear with such criticism??? Why Time Magazine should not criticize our
PM? Is he Almighty? Can he not go wrong? Then why Press should not
say? Why
we want media to say what our politician wants? Because our media says
what our Maananeey wants to say.
Why India should react at all to what President Obama says about what India should
do or not do. If Mr Anand Sharma feels that the FDI has gone up by 35% compared to
last year, he should simply sit back and relax. Mr Pranab Mukherjea would be more
than happy to hear about the increase in FDIs, despite his GAAR and retrospective
tax laws. So, where is the need to revisit these 'enactments' if they are not retarding
FDIs from pouring in ?
The explanations which our Honorable ministers are making against
Barack Obama's perspective remarks seem to be very ironical. If we
closely examine what was said by US incumbent presidents, we could easily infer that Barack Obama is talking about future growth here not
just looking or analyzing past glory which our country has already
achieved.
Although no one can interfere in our sovereignty, it's utmost right of
our countries' policy makers to make such policies which could again
bring back stalling single digit economics growth to an impressive
double digit number.
Instead of talking or presenting past astonishing facts, our
intellectuals think tanks need to take some hard decisions regarding
FDI in retail, aviation and other beleaguered sectors where we need a
huge chunk of money.
Yes Mr. Anand Sharma...It is our sovereign right. Nobody denies it. But are we making any policy?
Election speech of the head of any state is a well calculated move
with carefully drafted words to make an impact. We all know that our
policy makers will act for the best position of our country,with
Mamatas blocking the actions of this Govt,anybody will target us.Why
cry when first hit is from within the state? Forget Obama, he will be
taken care of suitably, let us concentrate on our actions to get out
of this difficult financial situation.Enough of Politics Didi,your
actions are politically disturbing.
The truth hurts. Mr. Obama simply speaks the truth. The problem is that this government has not done anything with this cherished god given right. So grow up, face up to reality,and make than implement good policies. WE are tired of empty talk and inefficient implementation
There is no doubt that with the consistently inconsistent policy adoptions of the UPA government,India has not only failed to attract further inflow of FDIs but has also triggered the exodus of the precious same.Under the circumstances,there is nothing wrong about the comments made by the American President Obama in this regard.
Why don't we take it as a brotherly advice instead of as a big brother strictures and make corrections where ever necessary?
Indian politicians should appreciate election pressures in the USA and
avoid over-reactions, which present them in poor light. They should
pick out any sound advice from a friend eg “It is still too hard to
invest in India.”
Is it not the duty of Govt Ministers to understand why, if India is
such a success story and investor friendly nation, is that fact not
getting through to investors, and what further steps are needed to
help them to invest in India, rather than blaming them for their
“perception problems”?
FDI could play a significant role in India's economic development. Did
the FM/PM not recently indicate that they were revisiting India’s FDI
policy?
Could FDI breathe life into the Indian airline industry and safeguard
the ancillary sectors, improve manufacturing and electronics
industries, develop much needed infrastructure (energy, transport
including railway freight, upgrading railway network and passenger
trains, etc)?
It is interesting to see how the netas twist inconvenient discussions.
Here, Anand Sharma has given the matter a twist of 'rights' and then
proceeded to defend India's 'rights' in order to deflect a meaningful
discussion. Did Obama imply that India does not have a right to frame
its own policies? I didn't think so. In fact, Anand seems to believe
that Indian netas have a right to propel their country to hell and no
one should say anything.
Mr Obama is in the election mode. In debt to China worth Trillions he
still have the nerve to lecture India, Recently India donated 4 billion
to help Europe.
It is their Nuclear superiority that gives them the right to dictate to
other countries.
An apt reply to Mr.Obama's remarks. Perception is more than welcome and heard in India but we must know that reality is different. Opening retail markets and international brands is going to create unemployment and will affect the poor.Rich will continue to enjoy but we must remember that we have our brothers and sisters who try to make the ends meet with just Rs.26 per day!
Our honarable minister instead of calling media and making a statement that policy making is our sovereign right.He needs to concentrate on how to improve our economic condition in this crucial juncture.If our govts whole motive is to continue in power till 2014 then every regional party leader in UPA will start exploiting their situation which has lead to our current state of policy paralysis.
Our govt. needs to concentrate on how to strengthen our country on economic front and be immune to Dollar and Euro fluctuations.We first need to improve our farmers situation by educating them,proviing subcidies and teaching them on how to make yeild from less space.Many countries does not provide water and current free of cost but still the farmers there are able to produce more yield compared to us. This tells us how backward we are in farming technologies.We need to send students with any agricultural degree to other countries and make them learn the new technologies adding value to farming.
Nobody has denied our government's sovereign right to frame its economic policies. President Obama has only commented on our government's economic policies and given some advice. The latter can reject these. But it seems improper to take offence at a friendly foreign leader's advice.
Indian currency is trading near the all time bad rate of Rupees 57 per US dollar. The economy is unable to stop the rise of petrol price because it has to be imported using the weak rupee. Rise in petrol prices causes domestic inflation and untold hardship to the common man. Now Foreign Direct Investment helps the foreign exchange situation, improves the rupee conversion rate (remember our currency was strong, trading at about Rs. 40, only about eight years ago). At that time the climate for foreign investors was almost as good as it was in China, Brazil and Russia. After a series adverse policy changes (e.g. the rejection of FDI in retail sector) in the past five years, FDI flow into India dropped perceptibly, rupee weakened, exchange rate went up, petrol prices rose and the GDP growth rate dropped from around 7.5% to about 5.5% - a downward spiral. This is not the time to play word games with President Obama – it’s time to reset the policies back to where it was.
This is an unnecessarily defensive reaction. Obama, in his speech,
acknowledged explicitly that it was up to India to make the policies
and reforms. He was simply expressing his perceptions (and the views
of American companies). We may or may not agree with his views -
which, I think, actually have a lot of merit - but we don't have to
misinterpret his statement as an interference in our sovereignty and
indulge in a sort of repartee that says, "you put your house in order
first". We should rather look at the great mess that Indian
bureaucracy is today, and fix our problems. To say, that the
Government, "in its wisdom, will take appropriate decisions at the
right time" is the most tepid non-statement that I have seen.
Indian politicians should know better in an election year, and avoid
over-reaction and use of emotive language.
It would help India's cause to review where India should welcome FDI.
Did the FM/PM not indicate that they were revisiting these policies?
Could FDI be a solution to save the Indian airline industry (which
appears to be in a critical state) and the ancillary sectors?
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