A rift has occurred between Assam Chief Minister Tarun Gogoi and West Bengal Chief Minister Mamata Banerjee on the question of retail FDI. Gogoi has said that India has a federal structure and so the decision on FDI should be in line with its federal policy. Cabinet clearance to FDI in multi-brand retail has been kept in abeyance as Mamata Banerjee put her foot down in the interest of farmers and small traders. Farmers’ organisations had however welcomed the Union Cabinet’s decision. According to Gogoi, the opposition of some Chief Ministers should be no reason why other Chief Ministers should not go ahead with the decision to improve the agri-economy. He argued that the decision held significance in unlocking the true potential of India’s agriculture. At present a large part of agricultural produce never reaches the market. Each state however is empowered to block or negotiate investments into retail business.
The Trinamul government of West Bengal has taken several steps to block the Centre’s policy in different areas. It may be pointed out that Gogoi’s stand on FDI in retail falls in line with Mamata Banerjee setting her face against the National Counter-terrorism Centre and the Teesta water treaty with Bangladesh. The Assam Chief Minister’s stand cannot be lightly dismissed as he has been returned to power three times in succession. He does not think that small retailers in his state will be affected by FDI in retail. In the last analysis, the decision will not depend on economic considerations but will be part of power play. Mamata opposed the Centre’s hike in petrol prices. The Trinamul and the Congress fought each other in West Bengal’s civic polls. However, the UPA is scared of the prospect of Mamata quitting the alliance. The TMC’s success in the civic polls has strengthened her hands.