The government has reached an agreement with the opposition for passing the banking amendment bill in parliament, Finance Minister P Chidambaram told reporters on Wednesday. The government is seeking parliamentary approval for amendments aimed at attracting more foreign investment into the banking industry, in the latest move by Prime Minister Manmohan Singh to open up Asia's third largest economy.
Meanwhile, BJP sources indicate that they will support Banking Bill if forward contracts clause dropped. CNBC-TV18's Siddharth Zarabi reports.
The most key contentious clause is the move to allow banks to enter into the forward contracts space. The Finance Minister initially was at pains to explain what this entire issue was because there was an immediate demand for that bill to be referred back to the Standing Committee, which would essentially delay the entire process of enacting this legislation by at least a couple of sessions.
Sources say the Finance Minister has reached out to Sushma Swaraj and Arun Jaitley the leaders of the opposition in the Lok Sabha and the Rajya Sabha respectively. There has been some sort of understanding that the BJP has developed within it because these leaders have gotten back to the senior leaders within the party on what needs to be done. It now looks like the BJP is comfortable with allowing a debate and passage of this bill as long as this contentious clause is dropped.
The Finance Minister could well stand up as and when that debate takes place today or any other day and he would say that we are sort of leaving this clause for the moment. If the government insists on keeping and retaining a clause that was not part of the original bill, and which had not been seen by the Standing Committee, then precedent suggests that it will have to go back to the Standing Committee, barring certain exceptional cases. At this point of time, the BJP would want to see the Finance Minister make that announcement, make that commitment when he speaks up and then the debate will proceed.
If that were not to happen, then the strategy will be decided there and then on the floor of the house. For now, it seems that some sort of understanding has been arrived at. A formal announcement of sorts could be made by the Finance Minister as and when the Lok Sabha deliberates the Banking Amendments Regulation Bill.