With the Supreme Court seeking an answer on whether UPA government's recent foreign direct investment (FDI) policy in retail had safeguards against hitting the interests of small traders, the government on Tuesday said it would file a detailed affidavit to "clear all
A bench of Justice RM Lodha and Justice SJ Mukopadhyaya gave three weeks' time to attorney general GE Vahanvati to file a detailed affidavit on the issue, including what response has the government got after the policy was cleared by the two Houses of Parliament.
"It's been four months since this happened. Have you got any investment which you were contemplating or is this just a political gimmick," the bench asked Vahanvati.
The top law officer responded by saying that FDI was part of government's serious efforts to initiate reform measures.
To that the bench said that reforms could not be done at the cost of small traders.
"Reforms is one part but the same should not close the doors of other traders," it said during the hearing of a public interest litigation challenging FDI in retail. Petitioner advocate ML Sharma has claimed that the new policy violated the fundamental right of small traders as they would have to shut shops.
As Vahanvati informed the court that the policy had received a green signal from both houses of the Parliament, the bench asked whether it had taken care of Sharma's contention that FDI would harm several small-time retailers across the country.
"What are the checks in place to ensure that there is no obstruction to free trade, especially the small ones. Policy is not sacrosanct, we would also analyse it within the judicial parameters. Our exercise is very constitutional and limited to the constitutional principles," the bench told Vahanvati, when he contended that FDI was government's policy matter and, therefore, did not warrant judicial intervention.
"It's possible that a giant retailer might reduce the price of a commodity forcing the small retailers to shut shop. Once there is no competition, the retail giant can monopolise," the bench said.
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