Prime Minister Manmohan Singh may have just got himself a double deal. It is not just for the Indo-US nuclear deal, but prospects are suddenly bright for the government?s long suspended reforms agenda as well, thanks to the expected exit of the Left from UPA.
Government managers acknowledged on Friday that freed from the Left grip, the government could push divestment of equity in PSUs and other reformist legislation in Parliament, even though UPA is at the fag end of its tenure. The government is likely to make an aggressive pitch to take up issues like opening up FDI in multi-branding retail and raising FDI in insurance to 74% from 49% now.
With the Samajwadi party pledging support to the nuclear deal on Friday, fears of the government falling have receded. In fact, the crutch is expected to give it considerable elbow room to pursue reformist items that had been put on hold in the last four years. The government will have to secure additional support of some smaller partners like the RLD and the JD(S) besides individual MPs to ensure a majority, but the silver lining will be that the Left parties would no longer wield clout over the ruling alliance.
This changed scenario brightens the chances for legislations like the banking reforms bill as well as the pension fund regulatory and development authority bill, that were kept in the cold storage, keeping Left objections in view, government managers said. They added that other legislations like the foreign educational institutions amendment bill as well as the unorganised sector social security bill, which had not found the support of Left parties, may also climb up in the priority list of government business.
Besides a proposal to sell 10% equity in Bharat Heavy Electricals Ltd, the Left had put the brakes even on disvestment of small equity in non-navratnas, including a 15% selloff in Housing and Urban Development Company,
National Mineral Development Corporation, Neyveli Lignite and Power Finance Corporation. The proceeds from the disinvestment was to go to the National Investment Fund to be used for social sector projects.