How the Govt won FDI fight in Lok Sabha

In a boost for the economic reforms, the UPA Government sailed through a determined Opposition onslaught to win the vote in the Lok Sabha on foreign investment in multi-brand retail - with more than a helping hand from the BSP and the SP, the two sworn enemies who bailed out the UPA-II for their own political compulsions on Wednesday, December 5, 2012.

The vote is expected on Friday, December 6, 2012, in the Rajya Sabha, where the government does not have the numbers.

In this picture (from left) Sushma Swaraj, Deepender Singh Hooda and Sonia Gandhi during the FDI debate.

In a thumbs-up for the second generation of economic reforms, shepherded by the Prime Minister, the government also won another motion on amendments to the Foreign Exchange Management Act (FEMA) to facilitate its initiative.

Both the motions had been moved by the Opposition. The motion on the Government's decision to allow 51 per cent foreign direct investment (FDI) in multi-brand retail, which would allow global supermarket chains to set up shop in India, was moved by the BJP and the CPI-M. The second one opposing amendments to FEMA was moved by the Trinamool Congress.

The Government may have won this crucial vote, but the point was not lost on watchers of the political scene as it owes its victory to internecine rivlary between two key parties, Samajwadi Party (SP) and the Bahujan Samaj Party (BSP), which prop the ruling UPA from outside.

Sonia Gandhi smiles during the FDI debate in Lok Sabha.

The BSP and the SP strategically walked out of the House before the vote, ensuring that Government sailed through the challenges.

The halfway mark needed to win the votes was reduced with the SP's 22 MPs and the BSP's 21 abstaining. Propelled by the unlikely Mulayam Singh Yadav-Mayawati combination, the Government won the FDI motion with a 35 vote margin - 218 votes for the Opposition motion and 253 against with 471 of the 544 members present in the House. The FEMA motion was won by 30 votes - the Opposition getting 224 votes and the government 254.

BJP leader Murli Manohar Joshi participates in the FDI debate in Lok Sabha.

A beaming Manmohan Singh, the prime mover behind the contentious FDI in retail initiative and the larger economic reform process, said the decision "has the approval of the House" and underlined that the Government is confident of its numbers in the Rajya Sabha.

RJD chief Lalu Prasad Yadav points fingers to BJP members during the FDI debate.

Industry lobby's hailed the vote, with Confenderation of Indian Industry president Adi Godrej saying FDI in retail "would lead to capital infusion in the country, which would help farmers and customers."

Harsimrat Kaur speaks during the FDI debate in Lok Sabha.

The Government touted the vote as a victory of pragmatism over ideological posturing. "It was a contest between reform and retribution. It was a victory of pragmatism over ideological blinkers. And ultimately, reform and pragmatism have won," Information and Broadcasting Minister Manish Tewari said.

Rahul Gandhi (centre) with Milind Deora and Sachin Pilot in the Lok Sabha.

A defeated Bharatiya Janata Party leader Sushma Swaraj slammed Mulayam Singh Yadav for walking out of the House and condemned the UPA's "arrogance of power".

Leader of Opposition Sushma Swaraj launches an scathing attack against the UPA.

The SP, which had said earlier in the morning that it was against FDI but would not do anything to "trouble the government", said the move was "anti-farmer".

Commerce and Industry Minister Anand Sharma defends Government's FDI in retail move.

"Five crore (50 million) people in retail trade will be destroyed. This decision has ignored the interests of 20 crore (200 million) farmers and their families. The decision on FDI was taken under pressure of foreign companies. This is the reason the party boycotted it," Mulayam Singh said.

Gurudas Dasgupta participates in the FDI debate in Lok Sabha.

The decision to allow FDI in multi-brand retail is expected to open the doors for major global majors like Wal-Mart, Carrefour and Tesco.

Commerce and Industry Minister Anand Sharma defends Government's FDI in retail move.