India will appoint a retired judge to probe claims that Walmart broke rules as it lobbied to enter the country's retail market, easing a tussle in parliament that had stalled proceedings.
The investigation will be a "time-bound" inquiry based on media reports into Walmart's activities, the parliamentary affairs minister, Kamal Nath, said today in the legislature. The company denies any wrongdoing.
Citing company disclosure filings made to the United States senate, the Press Trust of India said Sunday that Walmart spent as much as US$25 million (Dh91.8m) since 2008 on discussions regarding its foreign investments, including in the Indian retail industry. Opposition lawmakers, who last week lost parliamentary votes seeking to bar overseas supermarkets, have alleged part of the money was spent in India, where paid lobbying is not allowed.
"The allegation that a routine US lobbying disclosure form reflects improper conduct on our part in India is false," Walmart said. "This disclosure has nothing to do with political or governmental contacts with India government officials."
The statement gave no estimate of Walmart's lobbying expenses.
Victoria Nuland, a US state department spokeswoman, said the report was part of a regular, federally mandated disclosure.
"We have no reason to believe there was any violation of US law in this case," Ms Nuland said.
Protests in both houses of India's parliament over the issue ended yesterday after two days of disruptions.
Parliament last week endorsed a September decision to allow foreign investment in retail stores selling more than one brand, the centrepiece of the prime minister Manmohan Singh's biggest embrace of foreign investment in a decade.
In votes in both houses of the legislature, the government defeated opposition parties, led by the Bharatiya Janata Party (BJP), which argued that the move would put family-owned stores out of business. The win gave new life to a reform push as growth in the economy slowed to a three-year low.
A "report in the American Senate proves that Walmart spent money in India to enter this country", the BJP leader, Yashwant Sinha, said in parliament yesterday, demanding a judicial probe into the issue.
Overseas companies including Walmart, Tesco and Carrefour will benefit from entering the world's second-most populous nation, where retail sales are estimated to reach $863 billion by 2017, according to the Associated Chambers of Commerce & Industry of India and Yes Bank.
"The Walmart report has come in handy to the opposition to keep alive the issue after the victories of the government in parliament," said Sandeep Shastri, a lecturer in politics a Jain University in Bangalore. "It's a stick with which to beat the government."