Before FDI vote, govt faces FEMA rules roadbump

Nov 30 2012, 10:27 IST
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SummaryThe amendments are necessary to enable the government to notify the policy on FDI in retail

Setting the stage for the vote on FDI in retail, the government on Thursday gave notice in Parliament that it would table the RBIís amendments to the Foreign Exchange Management Act rules in both Houses on Friday.

The amendments are necessary to enable the government to notify the policy on FDI in retail, a segment in which trade is restricted under FEMA rules. The Left has already decided to move a statutory resolution against these amendments which, once admitted, would automatically involve a vote.

Unlike the discussion under Rule 184, losing the vote on this would turn the notification on FDI in retail invalid. In purely technical terms therefore, this vote carries much more weight ó a point that the Left has been trying to make over the past few days.

According to reliable sources, the government will now look to combine this vote with Rule 184 in a manner that there is voting only once in each House, and call it a political vote, not a vote on FDI in retail.

Government sources admitted that there was no escaping a vote right from the start, but it was important to first get its flock of supporters together. The Congressís message to the Uttar Pradesh parties, especially the SP, is to treat this as a vote for or against the BJP ó and not as just a vote on FDI in retail.

The Congress is more confident about the BSP after the SC/ST quota in promotions Bill was listed for discussion in Rajya Sabha.

It is learnt that Congress interlocutors have been working overnight to explain to the SP that its vote here should be of no consequence because its state government has already chosen not to implement the policy. In which case, it should simply take a political decision on which side to support.

This somewhat complex argument is yet to deliver results, but the Congress remains optimistic. Thursdayís notice adds to the complication because it is not clear how the opposition would want take up these votes once the Left submits its resolution. CPM parliamentary party leader Sitaram Yechury has made it clear that he would move the resolution soon after the FEMA amendments are laid on the table of the House.

The amendments pertain to removing restrictions on trading in retail enshrined in the FEMA. A PIL in the Supreme Court had recently sought a stay on the FDI notification on the

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