Is FDI in retail a gimmick, SC asks

Is FDI in retail a gimmick, SC asks

The Supreme Court on Tuesday sought the Centre’s response on how it will safeguard the interests of small traders after the UPA government gave its nod for FDI in multi-brand retail.

A bench of justices R M Lodha and S J Mukhopadhaya also wanted to know how much investment could be attracted after the change in the policy, wondering if it was a political gimmick.

“There is apprehension. How are you going to take care of the interests of small traders? It is going to affect the fundamental rights of traders.

What are the checks that you are going to put to remove the obstruction as far as their trade is concerned,” the court asked.

“Some regulatory measures have to be there to ensure that they (small traders) are not affected,” the bench added.

Attorney-General G E Vahanvati responded by saying it was not the issue that the court wanted to address. He said that the FDI was a matter of policy.

He submitted that the Parliament passed the necessary amendments in the RBI rules after the order issued by the court on November 5.

However, the bench said that the court can examine the matter. “We are not policy makers but it is also not correct that policy has to be sacrosanct every time. It can be examined within the Constitutional parameters,” the bench replied.

“We don’t substitute government policy but some regulatory norms have to be there…the apprehension is that these (big) companies can artificially reduce the price which the small traders cannot afford to do,” the court said, by adding “these apprehensions have to be cleared”.

The court then asked the Attorney-General to file an affidavit within three weeks addressing the allegation that the small traders would be affected by the policy.

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