Walmart 'lobbying' sparks stir, BJP wants probe

Washington/New Delhi: The Rajya Sabha again witnessed an uproar today after BJP senior leader Ravi Shankar Prasad raised the issue of a lobbying disclosure report filed by Walmart that revealed it had spent a massive $25 million lobbying to get entrance into India.

“Before FDI is implemented, first inquiry should be done on who all got the bribe. PM should make a statement in the house,” demanded Prasad.

"In 2012 alone, they spent US $ 3 million in India. Lobbying is illegal in India. This is a case of bribery," he said.

The Rajya Sabha had to be adjourned till tomorrow after the storm.

With the disruption in Parliament today, is the BJP trying to go to the extent of blocking a discussion on the issue of SC/ST quotas in promotions Bill?

"These are false allegations being made by opposition. No lobbying or payment has been sent to central government. There are reports that illegal payments if any, was perhaps made to states like Punjab," says a government source.

Global retail giant Wal-Mart — waiting for years to open its supermarkets in India — has been lobbying with the US lawmakers since 2008 to facilitate its entry into the highly lucrative Indian market.

As per the lobbying disclosure reports filed by Wal-Mart (Walmart) with the US Senate, the company has spent close to $25 million (about Rs 125 crore) since 2008 on its various lobbying activities, including on the issues related to “enhanced market access for investment in India“.

“Figures revealed are not fees towards India but figures spent on various countries by Walmart for lobbying purposes. What has been done is legal and something that (US) Congress reveals according to its records,” says Dilip Cherian, consulting partner, Perfect Relations, the Delhi-based public relations company.

In the last quarter ended September 30, 2012 itself, the company spent $1.65 million (about Rs 10 crore) on various lobbying issues, which included “discussions related to FDI in India”.

During the quarter, Wal-Mart lobbied for its case with the US Senate, the US House of Representatives, the US Trade Representative (USTR) and the US Department of State, as per its latest quarterly disclosure report.

The companies are allowed to lobby for their cases in various departments and agencies in the US, but they are required to file their lobbying disclosure reports every quarter with the US Senate.

So far in 2012, Wal-Mart has spent more than $3 million or about Rs 18 crore on its various lobbying activities, including those related to India.

Indian government recently opened up its multi-brand retail sector for foreign companies after years of political opposition and a Parliament motion against this decision was defeated last week in both Lok Sabha and Rajya Sabha.

The US-based supermarket chain operator Wal-Mart Stores, which has an annual turnover of $444 billion and a worldwide headcount of 2.2 million, has been eyeing for a long time to enter India.

The report also said that India remains one of the most favourable destinations for international retailers and an accelerated retail growth of 15-20 per cent is expected over the next five years.

What is lobbying?

In United States:

Lobbying is a legitimate business activity when it comes to the United States. There can be seen continuous reforms under the Federal Legal System pertaining to lobbying which have been acclaimed positively and negatively both. Presently, the mechanism in the most powerful nation provides the reporting mechanism which ensures transparency in the accountancy and the social justice to the citizens.

Indian scenario:

In India, Corporate Lobbying is expanding in the form of intensive briefings and presentations to Ministers and Senior Civil Servants. The political system in India makes Ministers, Officials, and Legislators more amenable to the term and its behavior. Further, the paucity of high-quality research centre and poor reporting mechanism makes officials vulnerable to slick lobbying and instant publicity countering allegations.

Presently, with the efforts of media and news, the stakeholders are turning more responsible and alarmed which in turn pressurize the corporations to provide detailed information on their lobbying.

Law Regulating Corporate Lobbying:

Presently there is no law regulating the corporate lobbying in India. Lobbying per se is not illegal however; it should stay within the logical limits. As per the suggestion given by the former Corporate Affairs minister Shri Salman Khurshid, corporate lobbying should be subject to the Right to Information (RTI) Act. RTI is a democratic right of people and provides transparency into the working of the government and its agencies. The only drawback which this Act suffers from is that it does not have in its ambit the areas of Public Relations, lobbying and specific influence that should be known to the general public.