Demonstrating its intent to push through big ticket economic reforms legislation, which the UPA government could not do due to lack of consensus among its allies as well as reservations of the BJP, the NDA government intends to move in the Rajya Sabha on Tuesday the bill to raise the Foreign Direct Investment (FDI) cap from 26 to 49 per cent.
Originally it was listed in Thursday's listed of business. However, the government has deferred the plan till Tuesday as opposition members have moved a couple of amendments to the bill.
The bill to amend the Insurance Act, 1938, the General Insurance Business (Nationalisation) Act, 1972 and the Insurance Regulatory and Development Authority Act, 1999 has been pending in the upper house since 2008 as the BJP wanted a clause to ensure that the management control vested with the Indian investors. Last week the Union Cabinet approved an amendment which ensures control of management of insurance companies with FDI.
Fate of the bill now hinges on the stand of Congress as the BJP has just 44 members in the Rajya Sabha. A senior leader of the Congress had said last week that his party is committed to raising cap of FDI in insurance to 49 per cent. At the same time the leader said that the Congress would take a view after looking at the fine print of the amendments proposed by the NDA.
After presentation of the union budget by the Finance Minister Arun Jaitley his predecessor P. Chidambaram had pointed out that the imprint of the UPA government's policies can be found throughout the Budget speech and in the Budget documents.
Mr. Chidambaram had pointed out that he fiscal correction path has been affirmed and the FD target of 3% in 2016-17 will be maintained, the recalcitrant States (Gujarat and Madhya Pradesh) have fallen in line and GST will be introduced and the BJP has found its 'appetite' for reform (that was suddenly lost in 2013-14) and the FDI cap in insurance will be raised to 49 per cent.
Taking a swipe at the BJP leaders who throughout the election campaign had slammed the UPA economic policies Mr. Chidambaram had said, “BJP sought a mandate for Congress Mukt Bharath. My friend, Arun Jaitley, would have realized that it is not possible to have even a Congress Mukt Budget. This is the NDA's government's and Mr Jaitley's first budget. Whatever its shortcomings, it is appropriate to wish them well”.
