May 17, 2004, is remembered as the Black Monday when stock market indices tumbled beyond belief, trading was halted twice and over Rs 2 lakh crore of market capitalisation was wiped off. Five years later, when it was clear that PM Manmohan Singh would lead UPA?s second innings with a greater majority for the Congress in the 15th Lok Sabha, the Bombay Stock Exchange Sensitive index shot up by 2,111 points from its previous close on what could be called the Green Monday (May 18, 2009).

The markets had a reason to be happy? after five years of sitting over key reforms thanks to his government?s Left props, Singh, unarguably the most qualified national leader (his brief biodata runs into 8 pages) finally had greater leeway to activate his economic reforms agenda. Even though his ministers? 100-day report cards are far from outstanding, Dalal Street?s confidence in the PM continues unabated?the Sensex has risen another 20% since Green Monday.

This is the best welcome accorded by the market to any Indian PM during his first 100 days in power. Rid of the Left?s habit of opposing every reform move blindly, market punters and foreign investors are betting on the PM pushing through bigger infrastructure spends, long-awaited financial sector reforms, disinvestment in public sector companies, et al.

The NHPC and Oil India IPOs, raising over a billion dollars together, are being seen as a big positive sign by global money managers. But the markets have a way of running ahead of reality? these IPOs were scheduled last year and were put on hold because the global meltdown had hit Indian market valuations, not because of the Left. All that UPA-II has done is timed these two issues.

FM Pranab Mukherjee has reiterated the Centre?s commitment to disinvestment but as of now, only the low-hanging fruit is being eyed?follow-on public offers by listed PSUs where the government?s stake is over 90%.

During the Budget debate, Mukherjee had promised to hold talks with allies and put out a blueprint on disinvestment in the public domain. But no talks with allies have been held and the minister has now been stressing that the reference to PSU sales in the Presidential address is all the UPA needs to go by.

Still, in its early days in office, maybe UPA-II wants to avoid a confrontation with its allies that would risk its overall reform plans. When coal minister Shriprakash Jaiswal recently talked of listing coal PSUs, DMK MPs threatened to bring the state (and the reform train) to a halt if Neyveli Lignite?s public float was increased (just like they did in July 2006). When Planning Commission chairman Montek Singh Ahluwalia called for ?clear, bold and better? disinvestment policy to bridge the Rs 1,60,000 crore resource gap for the Eleventh Five Year Plan, Trinamool Congress chief Mamata Banerjee cried foul.

Even the Congress? own haven?t displayed spine. Heavy industries minister Vilasrao Deshmukh had an open mind on BHEL?s disinvestment, but dispelled all possibilities after some employee unions conveyed their displeasure to him, on a visit to his home state Maharashtra. Deshmukh?s ministry controls the maximum number of central PSUs. In India?s short and chequered disinvestment history, a cabinet minister has never allowed a PSU under his domain and located in his home state to be privatised? and there?s no reason to believe this Cabinet will be different.

Key financial reform bills ? like the long-pending Pension Fund Regulatory and Development Authority Bill, the lapsed bill to amend the LIC Act of 1947? have been shied away from so far, though they may be tabled in the Winter session. And by paying homage to Indira Gandhi?s nationalisation of the entire banking system 40 years ago and terming it ?wise and visionary? in his Budget speech, Mukherjee has scored a self-goal on financial sector reforms. Be it scrapping the cap on voting rights for foreign investors in private banks or divesting stakes in public sector banks ?the FM citing Indira?s approach as ?our inspiration? is going to make these reforms a hardsell.

Again, consider the hue and cry raised by Vayalar Ravi, AK Antony, Vilasrao Deshmukh and Jairam Ramesh when the PM sought to clear the Asean FTA. It comes closest to the Left brand of politics?oppose first, discuss later. When the Kerala CM cried foul and turned up in Delhi, the PMO explained the nuances to him and sent him home, reassured that the state?s interests are safe. But if ministers don?t read their Cabinet notes before opposing the PM, it?s a worrying sign.

The PM may have got a clear reform mandate, but the Left within the Congress could scuttle progress. Surface transport minister Kamal Nath explained this best in July at the launch of an infrastructure report, just after Mamata didi threatened to walk out of a Cabinet meeting where amendments to the 1894 Land Acquisition Act were being considered. ?Building consensus is difficult. Forget the UPA, the Congress itself is the biggest coalition. MPs from different states have different issues they would like to focus on,? Nath said. Dalal Street, be warned.