With the onset of the winter session of Parliament today, the Modi government will face its first major test to push ahead with its reforms agenda.
Although Sunil Jain, Managing Editor of The Financial Express believes we are unlikely to see a fruitful winter session of Parliament, he is confident of Insurance Bill being passed in the current session.
Given that there are 67 Bills pending in both houses - 59 in the Rajya Sabha and 8 in the Lok Sabha coupled with introduction of new Bills, experts believe that the government's path towards getting legislative approval for many Bills is not going to be easy.
The constitutional amendment to facilitate the goods & services tax (GST) will be amongst several crucial bills to bolster the Centre's economic reforms agenda.
GST Bill in its current form may be tough to get passed, he says adding that benefits of GST will be lost if the revenue neutral rate is 27 percent.
Furthermore, in an interview to CNBC-TV18, Jain says that the government is not being brave enough w.r.t the Land Acquisition Act, which is yet another important agenda to be discussed in the winter session of Parliament. According to him, the government must seek support of regional parties on the same.
Below is the verbatim transcript of the interview:
Q: Can you lay down one-two-three realistic expectations from the winter session this time?
A: I think the GST Bill, which the finance minister has been talking about in its current form - if you look at what the empowered committee is talking about, I think the bill is a non-starter. And the sooner the government gave it up, the better because if you are talking about 27 percent revenue neutral rate, it is not going to take off. So there was a lot of expectation in this session that you will get the GST ordinance passed, you will get the GST Bill passed. So I think that is a problem and it is not in certain to what form if at all that is going to be introduced, that is the problem area.
The land acquisition Bill is a big area of hope and we have heard the finance minister saying that we are going to consult the opposition and if the opposition doesn’t go along, we will go alone, which is a very brave statement. But if you look at what the finance minister is talking about, he is talking about a carving out for PPP. That is not enough because how many PPPs projects we have in a year, three-four-five maybe. So the big challenge here is to get in land for industry.
So I think my view having spoken to a lot of people in the government is that the government is not being brave enough as far as the land acquisition is concerned. For whatever reason the coalition that seems to be getting built up with regional parties like whether it is the AIADMK, whether it is a Samajwadi Party, whether it is a TMC, there was a feeling some four-five months ago that the government has managed to get all these people on board. I think that seems to be breaking down. So that is another area of worry.
What else is left, the insurance Bill seems to be 50-50 as to whether that 49 percent will happen or not. So it is going to be a very tough session, I think the opposition party made it pretty clear that they are going to act in consort if you will but the good news here is if you move away from the legislative agenda, I think the fact is that on Coal India we have moved a long way, the fact is today the Coal India unions have said that we are not going to go on strike. So there is some positive movement that is happening.
As far as legislative agenda is concerned, I don’t think it is going to be as much of a walkover as we thought it was and it is not my impression that the Central government is very keen to have a joint session of parliament just like that. Theoretically, you can pass a lot of the Bills in the joint session but I don’t think you want to use your Brahmastra if you will for every bill. So I don’t know what bills the government will choose it for.
Q: You think that of the lot, the best chance is for the insurance bill, the Congress has indicated they will not oppose it, they see it as their baby. So is that the best one that we can expect and if that happens, could you call this a fruitful session after all?
A: I agree that you have got a good chance on the insurance bill but I don’t think that is a fruitful session at all. If you look at where we are at, the UPA left us with a lot of bad things. So even before this government gets on to doing positive things, what you need to - I think Arun Jaitley made this statement the other day that my first agenda is undoing a lot of stuff that happened. So you need to undo what happened on the land Bill. I don’t think that is happening here.
Everybody expected that with the BJP government in power since the BJP states for the one that were opposing the GST, everybody is convinced that the moment Narendra Modi came to power, GST would be a done deal. Now it may still happen but the signs that you are seeing from the empowered committee don’t suggest that anything has happened. So to my mind if people in the market are - what are they looking for in a session - I don’t think anybody is looking for the insurance bill, most people expect that it is a done deal. People are looking at the land acquisition bill, that will this get done or not. I think that will be a critical sort of takeaway for analysts or market watchers or whatever.
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