FDI in retail: Government to face stiff opposition in Parliament

JD-U President Sharad Yadav said that there will be unanimity within the NDA on the issue and his party will also reach out to other parties including UPA allies to put up united fight against this 'biggest assault' on Indian economy

New Delhi: The Union government is likely to face stiff opposition on foreign direct investment (FDI) in retail in the Monsoon session of Parliament beginning on 8th August, reports PTI.
An indication to this effect was given by JD-U President Sharad Yadav, who said that there will be unanimity within the National Democratic Alliance (NDA) on the issue and that his party will also reach out to other parties including United Progressive Alliance (UPA) allies to put up united fight against this "biggest assault" on Indian economy.
Yadav, whose party has given a notice to Lok Sabha Speaker Meira Kumar seeking permission to raise the issue in House during the upcoming session, thanked Trinamool Congress chief Mamata Banerjee for halting the move on FDI earlier.
Raising the banner of opposition, Samajwadi Party yesterday joined hands with Left parties and JD(S) asking the government not to go ahead with the controversial decision without wide-ranging consensus.
SP chief Mulayam Singh Yadav, CPI(M) General Secretary Prakash Karat, CPI General Secretary S Sudhakar Reddy, Forward Bloc's Debabrata Biswas, JD-S' Danish Ali and RSP's Abani Roy wrote a joint letter to Prime Minister Manmohan Singh, saying parties across the spectrum are opposed to this move.
The JD-U chief said he thanked SP, CPI-M, JDS and RSP for opposing FDI in retail, saying "they have rightly done so. This move will be the biggest assault on Indian economy." 
"We appeal to all parties including the UPA allies to oppose this anti-people measure. A population of 22 crore Indians are employed in retail who will be affected by this attempt of the government, in a similar manner like the entry of East India company had destroyed India's trade," Yadav said.
Congratulating Banerjee for opposition to FDI in past, he said, "Mamata Banerjee was the only ally in UPA who opposed it and ensured that there was no move forward on it." 
Yadav urged Agriculture Minister Sharad Pawar, the chief of another UPA ally NCP, to also "realise his responsibility" at a time when droughts are being reported from various states and oppose the FDI in retail saying it would exacerbate the problem by causing huge unemployment.
He said taking care of one's political future is right, but the NCP leader should also realise his responsibility.
The JD-U chief said that all political parties in the country should be united in opposing the move. "We will raise it in Parliament. A notice has been sent by us for taking up the issue in the coming session," he added.
Noting that the East India Company had come to the country in past looking for a market, Yadav said, "the search still continues for the Western world and it gets reflected every now and then -- be it through the statement by US President Barack Obama, the report of international credit agency Standard and Poor, the article in Time magazine or this attempt for FDI in retail," Yadav said.


Essar Oil secures Rs5,000 crore credit for its sales tax liability


Last week, Essar Oil told the Supreme Court that it would pay Gujarat the sales tax liability of Rs6,300 crore in instalments, the first of which will be deposited by 30th July  

Mumbai: Essar Oil on Monday said it tied up a new credit facility from a consortium of 12 domestic banks to provide a credit line of up to Rs5,000 crore to meet its sales tax liability of Rs6,300 crore, reports PTI.
The company continues to pursue the matter of repayment schedule of its sales tax liability both legally and with Gujarat.
Essar Oil is confident that with this facility it will be in a position to meet its entire payment obligations of Rs6,169 crore, the company said in a statement.
The company did not name the lenders but it has been learnt that the consortium is led by State Bank of India along with ICICI Bank, Bank of Baroda, Punjab National Bank, IDBI Bank, and Bank of India among others.
The details of the credit line such as the tenor, pricing etc could not be obtained.
The company has already paid Rs1,000 crore as first installment to Gujarat as directed by the Supreme Court last week.
Essar Oil managing director and chief executive Lalit Gupta said, "the new loan facility will enable us to meet the sales tax liability. Our lenders have continued to be very supportive of the business, which remains well placed given the demand for high value fuels both in the country and internationally." 
Despite the huge financial burden due to the tax case being lost, the company said, as previously announced, the completion of the Vadinar refinery phase-1 expansion and the early completion of the additional optimisation project at Vadinar are on course. Post expansion, Vadinar is expected to deliver significantly enhanced margins and cash flow generation in future to the company. 
On 17th July, Essar Oil had informed the Supreme Court that it would pay Gujarat the sales tax liability of Rs6,300 crore in instalments, the first of which will be deposited by 30th July.
Essar Oil had approached the apex court against the order of the Gujarat High Court which had refused any relief to it for making the payment in instalments.
The case pertains to the sales tax deferment benefits accorded by Gujarat to investors. The benefit given to Essar Oil was challenged in the High Court which directed recovery of dues and subsequently the company also lost the case in the Supreme Court.
The Supreme Court had in April refused to review its 17th January judgement which quashed the Gujarat High Court order allowing Essar Oil to pay Rs6,300 crore sales tax liability in deferred instalments and extended the time period of the state's tax incentive scheme.
The apex court had delivered the verdict on the petition by Gujarat challenging the 2008 high court order which had allowed Essar's plea on the issue. Following this on 10th July, Gujarat attached Essar Oil bank accounts to recover the dues.
Essar Oil had availed Gujarat's capital investment incentive to premier/prestigious unit scheme 1995-2000 for its Rs1,900-crore Vadinar refinery in Jamnagar district as a 100% export-oriented unit with a capacity of 9 million tonne per annum.



Anil Agashe

4 years ago

What non sense is this? Attach the assets of the company to recover the dues. Why should banks lend for clearing tax liability? What security is available for the lenders? Is it an unsecured loan? RBI needs to stop this transaction, let the Gujrath govt deal with the company under Sales Tax Act.

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