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The FEMA-nama: Govt can't escape vote on FDI

Wednesday, 28 November 2012 - 9:00am IST | Place: Mumbai | Agency: dna

CPI(M) leader Sitaram Yechury says government has to place the RBI amendment to FEMA in Parliament.

CPI-M leader Sitaram Yechury countered the government assertion that executive decision like the one on allowing FDI in multi-brand retail cannot be voted on in parliament, by revealing the constitutional and legal obligation to take parliament approval.

Yechury pointed out that the government had asked the Reserve Bank of India to amend Section 48 of the Foreign Exchange Maintenance Act (FEMA) which was necessary to facilitate FDI in multi-brand retail. In response to a public interest litigation, the Supreme Court said parliament will ratify the amendment of the rule as required.

Yechury said that he sought clarification from the Rajya Sabha chairman’s office and  was informed about the ratification process.

He explained that the government has to place the RBI amendment to the rule in FEMA on the table of parliament, and any member can oppose it as well as move an amendment to it. It comes under subordinate legislation business. Even if the government were to duck a discussion under Rule 184, it cannot escape parliamentary scrutiny when the RBI amendment to FEMA comes up for ratification.

CPI-M leader in Lok Sabha Basudev Acharia said that even if the issue were to be discussed and voted on under Rule 184, the legislative approval for the amendment is inescapable. The government cannot argue that the same subject cannot be discussed twice in the two Houses because the legislative process with regard to the amendment is a different thing altogether.

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