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HindustanTimes Thu,21 Aug 2014

Modi signals shift, bats for big retail; favours GST

HT Correspondent, Hindustan Times  New Delhi, February 27, 2014
First Published: 23:17 IST(27/2/2014) | Last Updated: 10:24 IST(28/2/2014)

BJP’s prime ministerial candidate Narendra Modi on Thursday called upon Indian traders not to feel intimidated by big retail chains and instead should learn to compete and work with them, signalling a shift in the party’s stand that has persistently opposed the entry of global supermarkets.

“We should not worry about the challenges from global trade,” Modi told a meeting of the Confederation of All India Traders (CAIT).

"The government should not look to curb online trade. We should not worry about these things our children have taken IT to the world. We'll have to embrace it."

The BJP and CAIT has so far opposed foreign investment in multi-brand retail stores, arguing that it would put the livelihood of millions of neighbourhood grocery stores and street vendors at risk.

Last month, the BJP-ruled Rajasthan government and the erstwhile Aam Aadmi Party (AAP)-led government in Delhi had reversed the previous government’s decision to allow global chains to set up superstores in both the states.

In 2012, the Centre had eased norms arming state governments the powers to allow or prohibit FDI upto 51% in multi-brand retail stores.

Read: Municipality head takes more decisions than UPA govt in Delhi, says Modi

Modi also vowed to eliminate bureaucratic red tape and favoured the roll-out of a unified goods and services tax (GST) aimed at stitching together a common national market by removing a web of state-level levies, a key economic reforms initiative that has remained stuck because of lack of consensus among state governments.

"As far as BJP is concerned, we are in favour of the GST. Nobody should have any doubts regarding it,” he said.

Modi also shot back at the finance minister Chidambaram for his comments on the former’s knowledge about economics.

In an interview to BBC, Chidambaram had said that the amount of economics that Modi knows can be written on the backside of a postal stamp.

On Thursday Modi said: “My knowledge about finance and economy will not occupy even a postage stamp. My whole knowledge can be confined to one word, that is trustee," he said, recalling Mahatma Gandhi's concept of trusteeship.

Read: Modi, Rahul Gandhi & Kejriwal dominate Google's search trends

Modi also signalled a supportive diplomatic regime for the economy as he hinted that while stepping out of businesses’ way in the pursuit of growth, the government will pull out stops in the realm of overseas trade and investment.

“Times have changed, the core work of external affairs ministry today is trade and commerce,” he said.

“Trade and commerce need to be brought to the centre of India's foreign missions' agenda,” Modi said.

In a separate address to top business leaders, the Gujarat chief minister dropped broad hints about the party’s likely economic agenda, should it come to power, but gave out little specifics about the probable policy direction.

Modi said it was critical to instill confidence among entrepreneurs, and the next government will inherit a weak economy with that is struggling to climb out of a decade-low growth.

“When Atalji (former Prime Minister Atal Bihari Vajpayee) was in power the GDP growth was 8.4%, UPA will leave it at 4.8%, we will have to start from there,” he said.

"We (India) are going through have fiscal deficit, governance deficit, moral deficit and security deficit…doing business in such an environment is difficult."

“In the last few years such an environment has been created as if talking of investment is a sin... we need investment in so many sectors, including agriculture,” Modi said.

Read: India lost a decade under UPA rule, says Narendra Modi

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