The demand for a vote on FDI shouldn’t be seen as worrying

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AS EXPECTED, the UPA regime got its way in the Lok Sabha when the motion opposing FDI in multi-brand retail was defeated. While this was not a confidence vote, and would not have formally made a difference to the government’s survival, the episode did bring to light conflicting positions as to the relationship between the executive and the legislature. It would be useful to examine these and see if anything is fundamentally flawed in our parliamentary practice, or if the problem really lies with the manner in which politics is practised.

Adherents of the government expressed concern that an executive decision — such as to allow FDI in multibrand retail — was being put to vote. This was unprecedented, they said, save for a similar discussion related to a disinvestment/privatisation proposal mooted by the NDA in 2001. In that case, the vote had been sought by the Congress. Evidently, positions have reversed since then. Presumably, they will continue to differ depending on who is in power and who in the Opposition. Yet, is this necessarily something to worry about?

The permitting of FDI in multi-brand retail entailed a small change in the rules used to implement the Foreign Exchange Management Act. Usually, this is undertaken by the Reserve Bank and does not require a full-scale amendment of the law by Parliament. This is a process called subordinate or delegated legislation. The changed rules are placed before the House, and in the normal course, passed without discussion, part of the residual leeway the legislature grants the executive.

In the case of FDI in retail, the Opposition sought a vote on the change in rules (which could potentially have nullified the policy change) as well as a discussion and vote on the new FDI policy (which could potentially have embarrassed the government without necessarily nullifying the policy change). It is worth noting that all of these provisions and nuanced differences — discussion without voting, discussion with voting, and the capacity to seek revocation of allowance for delegated legislation in a specific case — are within the laws that govern Parliament and perfectly constitutional. They represent a delicate and imbricated system of parliamentary oversight, scrutiny and, in some cases, sanction of the functioning of the executive.