ED approaches RBI before taking final decision in Walmart case

ED approaches RBI before taking final decision in Walmart caseThe Enforcement Directorate (ED) has reportedly sought the Reserve Bank of India's (RBI's) clarification on Foreign Direct Investment (FDI) rules before it takes its final decision on alleged forex violations Walmart and its Indian partner Bharti.

Sources from the Revenue Department revealed that the ED approached the central bank to seek clarity on FDI rules before and during the year 2010 in the local multi-brand retail sector.

U. S.-based retail giant Walmart is under regulators' scrutiny for allegedly violating FDI norms by investing in India's multi-brand retail sector in 2010, years before the Indian government opened the sector for foreign investors.

The Department of Industrial Policy & Promotion (DIPP) recently issued notification of press note 2 and 3, which provide definition of owned or controlled - a term vital to decide if a firm is a foreign or a domestic entity.

Speaking on the topic, a source said, "The DIPP and RBI would have to look into the notification with regard to this probe."

Meanwhile, emerging reports suggest that Walmart has stopped lobbying with U. S. lawmakers on issues related to India. Earlier this year, the retail giant stirred hornet's nest by openly announcing that it spent a huge amount of money on lobbying with U. S. lawmakers to seek their support to get entry into the fast-growing Indian market.