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Despite protests PM may go ahead with his reform agenda

September 14, 2012 22:07 IST

Prime Minister Dr Manmohan Singh has once again split the country politically down the middle by announcing Foreign Direct Investment in multi-brand retail in aviation, broadcasting and power transmission.

The prime minister who has been lampooned and pilloried by predominantly American publications for his 'policy paralysis' and for not taking forward the economic reforms agenda, cocked a snook even at his party's Left liberals when he told ministers in the meeting 'if we have to go down, we will go down fighting'.

This remark comes in the backdrop of protests from the United Progressive Alliance's own allies as well as the opposition, with the Bharatiya Janata Party charging the government of selling out to foreign interests.

Since long now, the US has been pushing Manmohan Singh and his team of "corporate and pro-US ministers" for dilly dallying on the FDI issue which has become crucial for US economic interests.

The decision to allow 51 per cent FDI in multi-brand retail, 100 per cent in single brand retail, 49 per cent in aviation and 74 per cent in broadcasting comes just a day after the Cabinet increased the price of diesel by Rs 5 as well as cut subsidies on LPG. Interestingly, the cheaper gas pipelines are common in the urban areas of Mumbai and Delhi, whereas gas cylinders in rural areas will now become much more costly.

According to a Congress worker, "this is no longer the sarkar of the aam admi."

Till late on Friday night the Congress had not reacted nor come forward to support the government, while there are vehement noises from UPA allies like Mamata Banerjee, Mulayam Singh Yadav, and parties like the BJP and the left.

Mamata Banerjee reacted strongly giving the government 72 hours to roll back diesel prices as well as the FDI move. She said she would not stand for it, but the question remains on how far will she go; whether she would withdraw her ministers from the government or withdraw her support from the government. Mamata Banerjee is credited with the view that early elections would be to her benefit and she would increase her tally of MPs. She also has to compete with the left when it comes to protesting against the reforms move.

The BJP is likely to intensify its agitation against FDI by Saturday since the move affects small and marginal traders, who are the main support base of the BJP. Even though the Union government has left it to the states to take their own decision on whether to reject or bring in FDI, the BJP is likely to make it into a major campaign point.

All eyes are now on Mulayam Singh Yadav and whether he would go all out to destabilise the government or look for another opportunity. An early election would suit Mulayam Singh Yadav as he thinks he could increase his Lok Sabha tally and emerge as a big player in putting together an alternative government to the Congress and BJP.

While it looks like the opposition and the allies are in the mood to declare war on the Congress-led government, what is interesting is the statement of the prime minister who appears to have made up his mind to go ahead on his reform agenda, knowing full well that charges of corruption are pulling his government down.

Renu Mittal in New Delhi