RSS affiliate seeks cap on fee paid to MNCs |
The Swadeshi Jagran Manch (SJM), an affiliate of the Rashtriya Swayamsevak Sangh (RSS) has written to Prime Minister Narendra Modi urging him to impose caps on royalty and technical fees paid to multinational companies in a bid to arrest the slide in the Indian rupee. In the letter, Ashwani Mahajan, SJM`s national co-convenor, says that the cap on royalty and technical fees payment, which was discontinued by the United Progressive Alliance (UPA) government in 2009, was a prudent policy as it helped in keeping a tab on outflow of foreign exchange. Mahajan claims that while foreign direct investment (FDI) inflows accounted for $60.96 billion in 2017-18, the payments relating to royalty and technical fees amounted to $20.65 billion. This shows how benefits of FDI are clearly being negated by the outflow on royalty and technical fees. Moreover, these outgoes would continue in future too, even when there are no FDI inflows, Mahajan added. Royalty outflows are payments made by domestic companies to their foreign parent firms or by Indian citizens to foreign entities for use of property, patent, copyright work, licence or franchise. SJM considers royalty and technical fees as a way in which foreign multinational corporations ``extract huge sums of money from the developing and underdeveloped economies``, said Mahajan.
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