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Why no one bought it

By not seeking consensus on FDI in retail, the UPA has exposed its blundering ways.

india Updated: Dec 04, 2011 22:38 IST

Politics, at times, is about selling a refrigerator to an eskimo. That is not the case when it comes to opening up multi-brand retail to up to 51% foreign direct investment (FDI). It is a policy that isn’t a gimmick and can, with the right sub-policies in place, change not only India’s consumer landscape but also that of Indian agriculture and its protagonist, the farmer. But a good policy also needs to be sold, and in a democracy that means obtaining consensus. The Union Cabinet’s decision taken last week on FDI in retail was bereft of any consensus. Most worryingly, the government saw it fit to not even attempt to seek consensus. The consequences of such unilateralism is now there for all to see. The UPA government now stares at the prospect of putting the FDI in retail in cold storage, which could be as good as a roll-back. Which brings us to the question: why announce a policy if you can’t see it through?

Spearheaded by the prime minister himself, riding roughshod over other opinions on the FDI issue has given the impression that the government was in too much of a hurry. Manmohan Singh is no longer a novice to politics. In his first term as prime minister, he scored a critical point when he personally steered the India-US civil nuclear deal in the face of much opposition. In the case of FDI in retail, Mr Singh has scored an own-goal by not even seeking out the support of his own party, never mind allies within the UPA, before his Cabinet took the decision. Charges of ‘policy paralysis’ have now been replaced with ‘policy knee-jerkism’. Which is a pity, considering the FDI in retail remains an issue that has far-reaching consequences.

That the UPA 2 has been sailing in choppy waters without much of a compass to guide its journey becomes apparent as we see Union commerce and industry minister Anand Sharma fail to explain why the FDI decision was taken during the winter session of Parliament. We also find finance minister Pranab Mukherjee being forced to cut a sorry figure as he makes damage control missions to UPA allies in attempt to make them not oppose the FDI policy. To find the Trinamool Congress’ Mamata Banerjee announcing that the Centre will be ‘suspending’ its FDI in retail decision, with Mr Mukherjee maintaining a deeply uncomfortable silence, paints a disturbing picture of how the UPA government does business. Now, Mr Singh and his Cabinet are scheduled to announce the deferment of the earlier Cabinet decision next week. One sincerely hopes that this time round, the government will do everyone — especially itself — a favour by seeking consensus on the FDI issue. That is, if the ad hoc-ism that’s been on display hasn’t already buried the matter for this government.