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The Cabinet has approved setting up of a one-man committee to probe into the allegation of lobbying activities of Bentonville-based retailer Walmart to gain entry into India.
This follows recent media reports on disclosures of Walmart before the US Senate regarding their lobbying activities.
The Committee which has been asked to submit its report within three months has also been asked to look into whether Walmart undertook any activities in India which contravene Indian law.
The Cabinet nod came in the backdrop of the Walmart CEO Doug McMillon meeting Union Commerce Industry and Textiles Minster Anand Sharma at Davos on Wednesday.
An official release added that Walmart was studying the conditions before making the final announcement.
At the meeting, Sharma said that India’s FDI policy in multi-brand retail has finality and investors need not be unduly concerned about any policy reversal. The Minister also asked them to send any request for clarification in the written form to his Ministry and all the necessary clarity will be provided.
Last month, the Indian arm of Walmart also independently set up an internal panel to probe into the charges. The panel will work alongside compliance experts Greenberg Traurig and consultancy firm KPMG, who are already probing into various allegations.
The company had earlier said it was taking “a systemic approach” to improve Foreign Corrupt Practises Act compliance in every market in which it operates.
Walmart has a presence in India through a joint venture with Bharti Group for operating its cash and carry venture Best Price Modern store. It provides back-end support for Bharti’s front-end retail ‘Easy Day’ stores.
Besides being in news for having spent Rs 125 crore for lobbying to enter India, the company is also under the scanner for allegedly violating foreign direct investment norms.
The supermarket giant had allegedly invested $100 million in a local supermarket chain.
The Reserve bank of India has already asked the Enforcement Directorate (ED) to probe Walmart’s investment in an arm of Bharti Enterprises – Cedar Support Services – for alleged violations of forex laws.
Bharti Walmart had earlier suspended a few employees as a part of the probe by the company into alleged bribery scam. Walmart calls its employees as associates.
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