Swadeshi Jagaran Manch (SJM) has demanded a probe into the Flipkart-Walmart deal and has asked the traders to support the organisation in its demand for the same. A meeting comprising of traders, Confederation of All India Traders (CAIT) Nagpur members and SJM representatives was held recently in the city to discuss various points of the Flipkart-Walmart deal.
While addressing traders from Nagpur during a meeting organised by CAIT, Nagpur, recently, the National Organising Secretary of Swadeshi Jagaran Manch (SJM) – Kashmiri Lal – said, “FDI in multi brand retail will not only kill entrepreneurship but will kill job creation opportunities in the market.” Kashmiri Lal added that the acquisition of Flipkart by Walmart will result in the latter’s back door entry into multi brand retail trade, which is not permitted under the present foreign direct investment policy of India.
Accusing Flipkart owners of evading taxes, Kashmiri Lal said, “We have noticed that Flipkart promoters initially transferred the ownership of the companies operating in India to Singapore and in subsequent years they made changes in ownership of the holding company at different valuations without paying any taxes in India.” Adding that Flipkart group has not abided by the laws, he said, “Flipkart Group has been circumventing laws while carrying on multi brand retail trade through e-commerce by flouting Reserve Bank of India’s directions on Foreign Direct Investment (FDI). It can be easily seen that through a complex corporate structure, the management of Flipkart is presenting itself as an entity in Business to Business (B2B) segment whereas it is operating both in B2B and Business to Consumer (B2C) segment.”
Stressing upon the importance of safeguarding interests of those at the bottom of the pyramid, Kashmiri Lal said, “Walmart is one of the world’s largest importer of Chinese goods. It will continue to pump in Chinese products, thereby killing our small and medium enterprises and destroying our ‘Make in India’ dream too.”
Talking about how the deal will hurt Indian farmers, Kashmiri Lal said, “We all know that both the companies have interests in the multi brand retail of food also. Together, both of the companies will hurt the interests of Indian farmers, who are still in the process of getting trained to deal with farmer producers organisations. It will still take time to make the farmers understand the value of their produce and instill negotiation skills in them to deal with the MNCs. The present government is committed to doubling the farmer’s income but these MNCs will not only bind the farmers, but will also kill their chances of experimenting with new crops and newer markets.”
Expressing dissent over the deal, the SJM secretary said, “The absence of a watchdog and the convenience of certain bureaucrats has allowed many violations to become a norm. At present, there are no rules set for e-commerce, so there is no check and balance. In absence of rules and regulations, companies such as Flipkart India Pvt. Ltd, Myntra Jabong India Pvt. Ltd and companies of similar nature should not be allowed to raise any funds directly or indirectly from existing or new investors.”
Addressing the gathering, Kashmiri Lal urged everybody to join SJM to put forth the following demands in front of the Government.
– An immediate inquiry should be initiated into the dubious Flipkart-Walmart deal, which has been written outside India but for all the tangible and intangible assets placed in India.
– An immediate inquiry should be initiated into the nexus between Flipkart companies and the so called independent B2C companies and how they were allowed to carry on their activities without any objections from the regulators including DIPP (Department of Industrial Policy and Promotion) in the past.
– To make a strong representation before the Competition Commission of India (CCI) asking it not to approve the takeover deal before the results of the inquiries being initiated are available.
– Instruct the tax authorities to inquire the modus operandi used by the promoters of Flipkart to take away ownership of companies and their brands outside India, various valuations at which ownership changes happened over the period and taxes involved into that.
Those prominently present at the meeting were Ajay Patki, CAIT National President New Delhi National President BC Bhartia, Nag Vidarbha Chamber of Commerce (NVCC) President Hemant Gandhi, NVCC Vice President Ashwin Mehadia, Dhananjay Bhide, CAIT Nagpur President Kishor Dharashivkar, general secretary Farooque Akbani, organising Secretary Nikhilesh Thakar, among others.