Attacking the governments assertion that it was keen to raise the cap on insurance, CPI-M general secretary Prakash Karat on Friday said the Left would firmly oppose it. He added that Left parties had not been consulted on the issue by the government so far. In discussions with UK chancellor of exchequer Gordon Brown yesterday, finance minister P Chidambaram had assured him that the UPA government was bringing legislation in this regard in the budget session.
In the first Budget of the UPA government (in 2004), they had announced the policy of increasing the FDI cap in insurance and we had opposed at that time and our stand remains," CPI(M) General Secretary Prakash Karat said. I dont know what they are planning to do now. We have only heard they are bringing some legislation... there was no consultation because we have told them we dont agree with it, he said.
The Left is particularly upset that the government has opted for an unusual strategy to get some of the controversial legislations passed, by splitting them and getting approvals in bits and pieces. Last week the Centre sought to take the ordinance route in getting the statutory liquidity ratio (SLR) cut to below 25 percent, which were originally included for passage in the Banking amendment bill.
The Left resistence to UPAs reformist moves will also be evident on Tuesday next week in a meeting of chief ministers called by the Centre to discuss pension reforms. Prime Minister Manmohan Singhs hopes of having the West Bengal chief minister Buddhadeb Bhattacharya speak sympathetically will be dashed as the CPIM has decided to send finance minister Asim Dasgupta instead to the meet. The government has been keen to open pension funds for investment in the markets.
The Left has been strongly against opening up of the fianancial sector to foreign capital, arguing that it would only increase the volatility of the markets.
We dont want the financial sectors to be taken over by foreign finance capital," Karat said, giving the prime reason for the Left opposition.