Indian Parliament in Furor Over Wal-Mart Lobbying

Discussion in 'Politics & Society' started by Ray, Dec 12, 2012.

  1. Ray

    Ray The Chairman Defence Professionals Moderator

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    By RUMMAN AHMED

    India's parliament was disrupted for the second successive day Tuesday as opposition lawmakers sought to equate a U.S.-mandated report of lobbying activities in Washington by Wal-Mart Stores Inc. WMT -1.75% with the bribery of Indian officials.

    Wal-Mart, in a disclosure report to the U.S. Senate, has said it spent $25 million on lobbying over the past four years, including issues related to "enhanced market access for investment in India."

    Lobbying of U.S. government representatives is permitted under U.S. law and the disclosure was required by U.S. rules designed to promote transparent governance.

    However, the Bharatiya Janata Party, India's main opposition, claimed on Monday that the report "officially confirmed that Wal-Mart Company has indulged in lobbying in India, or in simple terms indulged in bribery," according to a party spokesman quoted in the Indian media Tuesday. The spokesman couldn't be reached for comment.

    Wal-Mart's activities are being closely watched in India since the government earlier this year allowed foreign supermarkets to set up shop in India through joint ventures. The move was controversial, with opponents, including the BJP, saying it will harm mom-and-pop shops. The BJP last week forced a vote in both chambers of parliament in a bid to undermine the measure but the government prevailed in both.

    Wal-Mart has rejected the BJP's claim that disclosing lobbying activities in the U.S. amounts to bribery of Indian officials. "These allegations are entirely false," the company said in a statement. "In accordance with U.S. law, U.S. companies are required to disclose the issues and expenditures associated with lobbying on a quarterly basis."

    It added: "The expenditures are a compilation of expenses associated with U.S. federal lobbying contacts and include staffing cost, association dues, and payments made to consultants, all in the U.S."

    But as parliament stalled for a second day over the issue, the government suggested it was ready to hold an inquiry into Wal-Mart's disclosures. "The government views this with concern. With as much concern as what you have. We are not running away from this concern," Kamal Nath, India's minister for parliamentary affairs, told lawmakers in the lower house of parliament Tuesday.

    "We have no hesitation in having an inquiry on this as much as it concerns the amount spent by them in India. We want to get to the facts of the matter," he added.

    Indian Parliament in Furor Over Wal-Mart Lobbying - WSJ.com

    **********************

    Wall Street view?
     
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  3. Ray

    Ray The Chairman Defence Professionals Moderator

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    WalMart And The Indian Allegations Of Bribery

    There are Indian allegations that WalMart has been engaged in bribery over access to the Indian market. This is a difficult allegation on two counts. Firstly, that a large foreign company might be bribing has very strong political connotations in India. Secondly access to that grocery and retail market is jealously guarded on (perhaps misplaced) social grounds.

    Certainly bribery would be a serious offense. And corporate lobbying in India isn’t allowed, not legally at least. So perhaps there is a case for WalMart to answer?

    Probably not actually. For the allegation is that WalMart has paid (and declared, as they legally should do) lobbying fees in the United States over market access in India. And no, not even to firms which then lobby the Indian Government. Rather, to firms which then lobby the US Government.

    What they’ve actually done is tried to get the US Government to consider raising the matter of foreign access to the retail trade in India when they talk to Indian officials. Or when an aid matter is under discussion, or an investment treaty, a trade treaty. The complaint here really is that WalMart has been lobbying the US Government.

    And if we’re to be honest about it that’s not really a subject that an Indian politician should have much to say about, is it?

    So that the allegations have been made, and at least party believed, is a serious problem:



    The Indian Government has reacted furiously after it emerged that Wal-Mart has spent $25 million in lobbying fees to persuade the country to loosen restrictions on direct foreign investment in the retail industry.
    ….
    Ravi Shankar Prasad, the deputy leader of India’s main opposition Bharatiya Janata Party, said that the BJP wanted a full investigation into the payments and claimed that they represented “official confirmation that Wal-Mart paid bribes … Lobbying is nothing but a form of bribery.”

    WalMart And The Indian Allegations Of Bribery - Forbes
     
  4. Ray

    Ray The Chairman Defence Professionals Moderator

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    Walmart to apply US laws to Indian operations; wants anti-bribery undertaking from store owners

    NEW DELHI: Walmart is demanding anti-bribery undertakings from landlords of its Indian stores along with rights to inspect their books, the latest blowback from its global anti-bribery campaign that has put an unflattering spotlight on its fledgling India operations.

    The US supermarket group's India venture, BhartiBSE -0.30 % Walmart, now at the centre of a raucous political debate on the entry of foreign firms into the supermarkets sector, wants landlords of all its stores in India, including Easyday stores operated by partner Bharti Enterprises, to give undertakings saying they are not party to and will not indulge in corrupt practices, effectively bringing them under the ambit of US anti-bribery laws.

    Landlords are not only expected to certify that they have not paid any bribes while building the premises, but also give undertakings that give Bharti Walmart powers to periodically check their books and other documents, a person with direct knowledge of the situation told ET.

    A second source confirmed such an exercise was underway, and noted that KPMG had been tasked with securing undertakings from landlords. A landlord of an Easyday store in the NCR said a Bharti Walmart executive had called him earlier this week to inform him about an anti-bribery agreement that landlords must sign as part of the Foreign Corruption Practices Act, or FCPA, a 1977 US law that bars American firms and individuals from bribing government officials in any foreign country wherever they are operating or working in.

    Bharti Walmart has engaged KPMG to spearhead its anti-corruption campaign in India, and the consulting firm has undertaken programmes to sensitise employees about FCPA. It is also tasked with certifying vendors that are fit to do business with the retailer.

    Asked about the undertakings from landlords, Bharti Walmart said it was implementing a "number of specific, concrete actions to strengthen our compliance programme in India".

    "We take compliance with FCPA very seriously," a Bharti Walmart spokesperson said in an emailed reply to a list of questions from ET.

    DIFFICULT FOR DEVELOPERS

    We are committed to having a strong and effective global compliance programme in every country in which we operate. We are working diligently to strengthen our compliance programmes and dedicating considerable resources to this effort," the spokesperson said.

    While such action could help limit Walmart's liability in case misdemeanors come to light in the future, the US firm's latest demands are unlikely to go down too well with its property partners, most of whom could find it hard to give such undertakings because of the nature of doing business in India.

    Developers have to obtain more than a dozen approvals from assorted government offices before building and operating malls in India.

    These range from design and usage of the property to fire and safety clearances to environmental approvals, many of which are provided by agencies and departments that many view as hotbeds of corruption.

    Walmart to apply US laws to Indian operations; wants anti-bribery undertaking from store owners - The Economic Times
     
  5. Ray

    Ray The Chairman Defence Professionals Moderator

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    What exactly is happening?

    One sees the FDI passed by the Parliament and now this bribery shenanigan, which actually was from the mandatory disclosure in the US as per their law by Walmart.

    It is also known that Walmart was involved in widespread bribery in Mexico.

    How far is the claim made that we have sold our sovereignty to the US just because Ms Clinton is allegedly to have said to have spoken about Walmart in FDI in retail.
     
  6. sob

    sob Moderator Moderator

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    If Walmart has bribed Indian officials to pass the bill then the guilty must be caught and exposed. Walmart is not the only store in the world. We can do without it, if they do not seem interested in following Indian Laws.
     
  7. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    Government will launch the probe, absolve itself and case will be closed ;)
     
    iNDiAN.96, jackprince and W.G.Ewald like this.
  8. sasi

    sasi Senior Member Senior Member

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    Not sure abt officials , but i bet some medias got it !
     
  9. W.G.Ewald

    W.G.Ewald Defence Professionals/ DFI member of 2 Defence Professionals

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    Where is that line between lobbying and bribery... can it be seen with the naked eye?
     
  10. SADAKHUSH

    SADAKHUSH Senior Member Senior Member

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    The line between bribery and lobbying is drawn where no favour of any kind is exchanged at any level between the lobbyist and the officials. What GOI has not been able to do since Independence the Walmart wants to achieve that than I want to join the company and move to India.
     
  11. sob

    sob Moderator Moderator

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    In India Lobbying is not legal. We can debate about the finer legal points, but we have to follow the law.
     
  12. Ray

    Ray The Chairman Defence Professionals Moderator

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    Lobbying with money is OK when it suits but is bribery when it does not. ;)

    Walmart is not bribery, but defence deal lobbying is bribery! :rofl:
     

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