Tamil Nadu chief minister J Jayalalithaa on Tuesday lashed out against the central government for its inept handling of economy and poor macro management for the past several years.
The depreciation of the Indian Rupee the direct reflection of the failure of the central government, which on Tuesday is bereft of ideas.
And to show some presence of a policy response to an adverse economic situation, the Cabinet Committee on Economic Affairs has recently approved the raising of the Foreign Direct Investment (FDI) caps in some sectors, Jayalalithaa said expressing serious concerns over this move.
"These measures raise a number of serious concerns. Far from protecting the interests of workers and the common people of the country, the UPA government appears to be acting at the behest of foreign interests and some external Rating Agencies which are frequently threatening to lower the Sovereign Rating to 'Junk Status' and thereby cowing down the weak UPA government at the Centre, making it bend to its whims and fancies," the chief minister said in a press statement.
The decision also raises serious security and related concerns, which have been totally ignored. The adverse impact on domestic industry, including on Central Public Sector Enterprises and employment has also not been factored in, Jayalalithaa said.
In the Telecom Sector, the FDI cap has been raised from 74% to 100%. This has implicit security concerns since foreign companies will be able to control the entire telecom network. Data security and privacy issues will arise, which will be very difficult to regulate.
This was also witnessed recently in the case of a Private Service Provider who had laid more emphasis on individual privacy rather than National Security, she said, not naming the company.
Noting that the union home ministry too was against the hike in FDI cap in telecom, she said the move would only benefit foreign companies which have reportedly incurred losses on account of the orders of the Supreme Court in the issue of 2G Licenses.
Even advanced countries restrict foreign investment in the telecom sector precisely for security reasons, whereas the Government of India seems to be oblivious of these concerns, Jayalalithaa said, opposing the union government decision.