Alleges Walmart has made illegal investment in multibrand retail

Trinamool Congress chairperson Mamata Banerjee on Sunday continued her tirade against the United Progressive Alliance government and criticised its decision to allow foreign direct investment in multibrand retail and pension fund.

Claiming that the “future of pensioners will crash” if FDI is allowed in pension, in a post on her Facebook page, she urged the people to remain “united and oppose this move.”

“Left high and dry”

Ms. Banerjee narrated the “tragic experience” of an Indian working in a well-known IT company in California, who lost 50 per cent of his savings he had put in pension funds when the U.S. stock market crashed during 2008-09. “He was left high and dry without compensation and faced an uncertain future.” Ms. Banerjee said it was not a stray case. He was “one among the millions of sufferers in the U.S. whose funds were invested in the stock markets … . Do you want this to happen to you and your fellow countrymen on introduction of FDI in pensions by UPA II?”

Earlier during the day, in another Facebook post, the West Bengal Chief Minister alleged that Walmart had made illegal investment in multibrand retail “overcoming” the existing restrictions on investing in this sector.

“Quietly, in a stealthy manner, Cedar [a company fully owned by the Bharti Group] invested the entire FDI it had raised from Walmart in Bharti Retail Limited, hoodwinking the government.” She said Bharti Retail Limited was engaged in multibrand retail operating ‘easy-day’ stores.

In December 2009, the main objects of Cedar were amended to provide services in real estate consultancy — in the consulting service sector, Ms Banerjee said.

Since FDI in the consulting sector was allowed 100 per cent under automatic rule (foreign investors only need to inform the Reserve Bank of India within 30 days of bringing investment as per this rule) Ms. Banerjee said Cedar was made to look like a company engaged in consultancy services.

“Walmart [knowing fully well that Cedar does not need FDI for its own business and that the FDI will be invested in multibrand retail] invested under automatic route Rs. 456 crore as FDI in Cedar,” she said.