On behalf of the BJP,” party leader and chairman of the standing committee on finance Yashwant Sinha said, “I can tell you we will oppose the Banking Laws Amendment Bill if the government insists on retaining the clause that allows banks to invest in commodity futures.” Sinha, who was speaking at the Express Group’s Idea Exchange programme on Thursday, said this in response to finance minister P Chidambaram's statement that the government had reached an agreement with opposition parties to pass the Bill in Parliament, and that he had discussed the matter with BJP leaders Arun Jaitley and Sushma Swaraj who understood the urgency to pass various reform Bills.
Sinha reiterated his stated position that a new clause which changes the very nature of a Bill could not be inserted after the standing committee had deliberated on it. “Also, it is irrelevant whether the clause has been okayed by some other committee because the Bill was sent to the standing committee on finance,” the BJP leader said, in response to the government position that allowing banks into commodity futures had been cleared by the standing committee on consumer affairs last December.
It was up to the government, he said, to put the Bill to vote, but he commented that there was “a very large common position” on the issue in the Opposition. Asked if the fact that the regulator in commodity markets was seen to be relatively weaker than those in the stock or currency markets — banks are allowed to operate in the futures section of these markets — was an issue, Sinha answered in the affirmative saying “that could be a problem”.
Sinha defended his party’s position that when it came to power, it would reverse the decision to allow FDI in multi-brand retail. “We believe,” he said, “as the government has said, that this is an executive decision, and executive decisions can be reversed.” If FDI in multi-brand retail was an executive decision, why was it put to vote? “Because executive decisions can be voted on,” he said. Sinha added that the history of reforms in India has been that various decisions taken by different governments had been changed later. The NDA’s Balco residual stake sale to Anil Agarwal being turned down by the UPA is a case in point.
Though Sinha said his insurance Bill had originally wanted a 23% stake for FII/NRI/OCB in addition to 26% FDI, he said the standing committee would have to examine it afresh.
The BJP, he said, preferred a more widely-held structure in which the foreign and Indian promoters each held 26% of the equity with foreign institutional investors and the Indian public accounting for the rest. “The government has not come to us with a proposal to increase allow FIIs to hold 23%. If they do, we will consider it,” Sinha said, pointing out that when the NDA government had wanted FIIs to be allowed to invest in insurance companies, the Congress party had shot down the proposal. “The Congress told us that on the pain of death that we couldn’t raise the FDI limit to 49%,” Sinha said.
“Don't blame the BJP for the delay in GST,” Sinha said. “It is all due to the government and its penchant for developing wisdom and adding new things to Bills every day – the government's wisdom tooth is getting bigger by the day!” Outlining the history of GST, Sinha said his standing committee had planned to give its recommendations in the Monsoon Session but the finance ministry never gave its final view on the Bill. Later, when the new finance minister P Chidambaram came in, he began discussions afresh with the group of state finance ministers and even appointed two committees to examine the issue. We wrote to the finance ministry, Sinha said, to ask which was the final GST Bill that needed to be examined. “We were told the committees will submit their reports by December 31, after which the finance ministry will apply its mind to whether any new amendments were needed… So don't blame us for any delay.”