This refers to the report “Amend Fema regulations: SC” (October 16). Despite accepting the prima facie position that the government’s policy on foreign direct investment (FDI) in multi-brand retail didn’t have legal sanction, the Supreme Court has suggested to regularise the position by requesting the Reserve Bank of India (RBI) to amend the Foreign Exchange Management Act (Fema). This was all the apex court could do to salvage the situation for a government that is already in the dock. UPA-II’s fire-fighting team should take the message of the Supreme Court ruling, that is, to follow the rules of the game in what it wants to do. The court must have been sadly aware that it might be odd to ask RBI to amend regulations in the Fema to regularise an executive decision of the government — which should have been issued after consultation with RBI.
The government should also review its action on other issues like the introduction of the New Pension Scheme (NPS), where legislative sanction is pending. Enforcing measures that need legislative sanction through executive order and then going to appropriate authorities/Parliament to regularise these when there seems to be no “emergent” situation warranting such action sends out disturbing signals. In the absence of necessary numbers in both the Houses, this method may become a rule rather than exception in days to come.
M G Warrier Mumbai
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