Govt hopes to pass insurance, other Bills in winter session

Written by ENS Economic Bureau | New Delhi | Updated: Nov 2 2013, 14:33pm hrs
The government expects to be able to steer the insurance Bill through Parliament in the winter session.

Most parties, including the principal opposition have assured me of their support to it, finance minister P Chidambaram told reporters on Friday. He added that the government hoped to pass as many as 12 legislative Bills in the session, which would be the last full session before the 2014 Lok Sabha elections.

Chidambaram also expressed confidence that the worst may be over for the Indian economy. The minister made these comments after the stock markets closed at a lifetime high on Friday.

The Bombay Stock Exchange Sensex touched 21,293.88 in intra-day trade before closing at 21,196.81. The markets seem to be very happy. (They) seem to welcome the RBI and government measures. But I would caution investors against excessive exuberance, Chidambaram said.

The minister said the Reserve Banks decision to raise the short-term lending (repo) rate by 0.5 per cent in two instalments was right. RBI Governor Raghuram Rajans steps needed to be understood in the context of high inflation and stabilisation of the depreciating currency. The RBI has reversed the tight liquidity conditions and MSF hike in two successive policies and we are now returning to a normal policy, he said. These were Chidambarams first comments after the RBI raised rates.

The insurance Bill which seeks to raise the foreign direct investment ceiling in the insurance sector to 49 per cent has been with the Rajya Sabha since 2008. The Cabinet had approved it again in October 2012. The standing committee on Finance had, however, suggested that the cap should be kept at 26 per cent. The government is now understood to be considering a proposal to raise the FDI cap to 49 per cent without an increase in voting rights. Passage of the Bill is expected to bring additional capital for the insurance sector, and help India finalise free trade pacts with the EU

On the Direct Taxes Code Bill, Chidambaram said fresh amendments have to be placed before the Cabinet for approval, which will also decide when it would be tabled in Parliament. I have to move a supplementary note (on the Code) to the Cabinet and it is up to the Cabinet to allow us to take it to the winter session, he said.

He also said there would be other non-legislative reform measures such as currency futures and inflation indexed bonds for retail customers.

IT Act amendment only after resolution of Vodafone case

New Delhi: Finance minister P Chidambaram on Friday said that resolution of the Rs 11,200 crore Vodafone tax case is essential before amendments to the Income Tax Act on retrospective changes can be introduced in Parliament.

The question is how we move forward... Amendment (to the IT Act) has to be moved but I can move that amendment only after the Vodafone case is resolved, he said. The government has sought a non-binding conciliation with Vodafone to resolve the tax issue ensuing retrospective amendment to the Income Tax Act in 2012.

We are still in talks with them. Vodafone has to decide on the process... We are very clear we want conciliation that is fair and is accepted by the Parliament, he told reporters. ens

FM approaches EC to launch Womens Bank before elections

New Delhi: Ahead of the upcoming assembly election in Delhi next month, the finance ministry has approached the Election Commission for permission to launch the planned Womens Bank.

There is the small problem of elections in Delhi and we are talking to the EC. We want to launch it on November 19. All the work on it has been completed, said finance minister P Chidambaram. November 19 is the birth anniversary of former Prime Minister Indira Gandhi.

Proposed in Budget 2013-14, the Bharatiya Mahila Bank will support women entrepreneurs and women-run businesses. The finance ministry plans to open six branches in its inauguration, including one in Delhi and another in Mumbai. ens