As the winter session of Parliament came to an end on Tuesday, highly placed sources said the government is determined to push through the raised cap on Foreign Direct Investment in insurance via the ordinance route.
At least two senior Ministers indicated that the Narendra Modi government was left with no other option but to effect the policy change through an ordinance. One of them said the ordinance was necessary to “spell out the government’s intent” even though he did not expect foreign investors to immediately invest in the insurance sector in the absence of an enabling legislation. “The makers of our Constitution have thought far ahead for every situation. For everything else, there are enough precedents,” said the other Minister, alluding to ordinances being brought in the past to push key policy decisions.
Reacting to the Opposition’s criticism that the government wanted to push through the insurance legislation before U.S. President Barack Obama’s visit to India in January 2015, the Minister said: “They are the ones obsessed with Mr. Obama. We are only thinking of national interest.”
The Union Cabinet had earlier this month cleared a proposal to raise the FDI cap in insurance to 49 per cent from the current 26 per cent. The government brought in amendments to a Bill in Parliament for the necessary legislative sanction. The Insurance Laws (Amendment) Bill, 2008, that had been listed in the legislative business of the Rajya Sabha, was not passed till the House adjourned on Tuesday afternoon due to frequent disruptions.
The Upper House where the ruling NDA is in a minority saw little legislative business being transacted. The Lok Sabha passed eight Bills but these could not be passed in the Rajya Sabha. In all, 16 Bills were introduced this session — only one in the Rajya Sabha. As against 102 per cent productive hours in the Lok Sabha, the Rajya Sabha barely clocked 61 per cent. The government had planned on getting 18 Bills passed, only 10 went through.
