Unfazed by the political storm brewing across the country, Prime Minister Manmohan Singh went ahead to push through the second round of big ticket reforms.
On Thursday, the UPA-II, in a crucial Cabinet meeting, cleared FDI in insurance and pension and raised the cap to 49 per cent. “The FDI limit in pension will follow FDI limit in insurance. If insurance bill passes with 49 per cent, pension will also be 49 per cent (sic),” finance minister P. Chidambaram announced. The Cabinet also cleared the Companies Amendment Bill.
While earlier the Trinamul Congress had walked out of the UPA protesting against the Prime Minister’s reforms moves, the DMK, with 18 MPs, boycotted Thursday’s Cabinet meet. Despite Cabinet clearance, the government will now need to push through the legislations in both the Houses. This appears to be tricky as the UPA-II is low on support in Parliament. It is in minority in the Rajya Sabha. With the DMK boycotting the meeting on Thursday, the government could also find itself in a difficult situation in the Lok Sabha despite having a simple majority.
The UPA has a strength of 254 in the Lok Sabha. If the DMK refuses to come on board, the strength will be reduced to 236. Once again the government will have to depend on the SP (21 MPs) and the BSP (19) to get the bills passed.
Sources say that the government could possibly rely heavily on the BSP as it is not certain about the SP’s support. Moreover, TMC chief Mamata Banerjee has threatened to move a no-confidence motion against the government in the Winter Session of Parliament.
Aware that the government will have to rally political outfits to pass the contentious Pension Fund Regulatory and Development Authority (PFRDA) Bill and the insurance amendment bill, Mr Chidambaram said the government “will engage all political parties for their passage”.