The second round of big-ticket reforms may find it extremely difficult to get the required political approval in the two houses of Parliament.
To compound problems, the main Opposition party — the BJP — sounded quite vague on whether it would lend support to the pension bill. “We have a number of caveats,” said BJP’s Prakash Javdekar with a degree of ambiguity. “We shall consider the bills positively provided our demands are met.”
If the Congress has the BJP’s support then both these bills can be easily carried without any numerical hitch and the Congress does not need numbers from any other political quarter. But given the changed political circumstances, with a scam-hit government trying to bulldoze its way through a negative political climate by getting on to the reform bandwagon, the BJP may think more than twice before coming around to bail the government out.
The government has taken a big gamble by going big on reforms. A senior BJP leader said the party had been in a conversation with the then finance minister Pranab Mukherjee over opening up the pension sector to foreign direct investment.
Mukherjee had even extracted the promise of support from a softened BJP provided certain demands like an assured return from public provident fund were met.
The leader recalled that the dialogue with Mukherjee ended abruptly when he was elected the president. And the BJP commitment cannot be taken for granted.
Arun Jaitley, BJP leader in the Rajya Sabha, told the DNA: “We shall have to go through the fine print before arriving at a conclusion. We also need certain commitments from the government. “He thought that in the end if the BJP was agreeable to pension, it may find it difficult to extend support to the raising of the FDI cap to 49% in the insurance sector.”
There is a difficulty in the insurance sector because the Parliamentary Standing Committee, headed by former Union finance minister and senior BJP leader Yashwant Sinha, had agreed to an FDI cap of 26% in this particular sector.
The BJP does not see any reason to change its mind. The BJP knows that there is opposition against these FDI moves across the political spectrum and does not want to lose the chance of striking new friendships.
The SP has already cried foul. Of course, the SP making noisy protests does not amount to much because the opportunist in Mulayam Singh Yadav may change his mind at the last moment and come around to help the government.
Even Mayawati has kept silent though she is expected to speak her mind on supporting the UPA-II from outside at her own party meeting on October 9.
The problem is that with possible SP and BSP backing, the Congress can hope to get the necessary legislations passed in the Lok Sabha but in the Rajya Sabha it does not have the numbers and would have to compulsorily take the BJP on board.
And this is where the crux of the problem lies. In the BJP, too, there is some confusion. After all, it is a party which aspires to rule the country at some point or the other and cannot alienate the corporate sector with an anti-reform stance.
As expected, the Left is opposed to the move. And even more than the Left, the Mamata Banerjee camp is spewing vitriol against the Centre, pledging to oppose FDI in insurance and pension.
Banerjee said in Kolkata that the decision of the “minority government” to go for FDI was ,“immoral and unethical”. “Today, yet another set of anti-people decisions of the central government have crossed the Lakshman Rekha,” she wrote on her Facebook page.
Senior party leader Saugata Roy said the party would oppose all these decisions on the floor of the house.