After passing Land Bill, BJP now needs to change it
While it is expected the government will be able to get passed a large number of the of the 67 Bills it has planned for the current session of Parliament, what matters is really just a handful of Bills, and the prognosis on them is far from clear. The Bill to hike FDI levels in insurance, currently with the select committee of Parliament, is expected to sail through, so that should help attract some FDI. The coal Bill, similarly, should go through, though the Congress would like to oppose that part which seeks to bring in commercial mining. It’s not clear how the negotiations on this will work out, but the positive sign here is that, with the Sangh Parivar managing to persuade the Bharatiya Mazdoor Sangh, one of the largest trade unions in the country, to distance itself from the Coal India strike—as a result, all Coal India unions called off the strike to oppose disinvestment—the opposition on this may be muted; more so, since the government will argue that the interests of Coal India will be fully protected while opening up the sector.
The critical Bills to watch are the Land Acquisition, Rehabilitation and Resettlement (LARR) and the GST ones. In the case of the LARR Act, the good news is the finance minister’s statement that, if the Opposition did not cooperate, the government was willing to go it alone. What’s not clear is what changes the government wants to incorporate. So far, the public statements emanating from the government relate to a carve out for PPP projects. Given there are just a handful of PPP projects in any year, this doesn’t really amount to much. The critical problem here is that even industrial projects where the land is privately acquired will not find it possible to go ahead without a SIA (Social Impact Assessment). While the Congress party has made it clear that it intends to oppose any change, most regional parties were opposed to various aspects of the Act in its current form. Normally, the support of regional parties like the AIADMK and the Samajwadi Party, both of whom were opposed to critical sections of the Land Act, should be enough to get the changes through; the question really is of how ambitious the government wants to be—on various occasions, top leaders of the BJP have made it clear that even PSUs and government organisations like the Railways and even defence are finding it difficult to carry on with their business under the current Act.
GST is another problematic Bill, and getting it through will not be easy; but if GST has to be a reality by April 2016, the date set by the Prime Minister, it needs to be passed in the current session of Parliament. The problem with GST, however, as this newspaper has argued before, is that if it is passed with a revenue-neutral-rate of 27%, it may as well not be passed. Also, if important goods like alcohol and petroleum products are kept out of its purview, the other benefit, of eliminating border checkposts, will not happen. With political parties like the BJP contributing to the mess, at the Centre in the case of LAAR and at the level of the states in the case of the GST, breaking this deadlock isn’t going to be easy.