BJP to back govt on insurance Bill
Tribune News Service

NEW DELHI, Dec 8 — Taking recourse to the practical terrain of realpolitik, the BJP today decided to back its government on the controversial Insurance Regulatory Authority (IRA) Bill, shedding all ideological pretensions.

While a patch-up was reportedly arrived at a marathon four-hour meeting of the central office-bearers of the party at the Prime Minister, Mr Atal Behari Vajpayee’s residence last night, attended by the party President, Mr Kushabhau Thakre with his five general secretaries. Sources said the patch-up became possible only after meetings between the Rashtriya Swyamsevak Sangh (RSS) and BJP leadership including the Union Home Minister, Mr L.K. Advani.

The meeting then saw the party and the government debating the finer points and pros and cons of the Bill, which provides for 40 per cent foreign equity participation.

Then followed a meeting of the Parliamentary Party, where the Prime Minister, the Home Minister, Mr L.K. Advani and the Finance Minister, Mr Yashwant Sinha, explained at length the implications of the opening up of the insurance sector.

It was left to Mr Advani to explain the government’s stand on the insurance issue. He, according to some party MPs present at the meeting, said there should not be any hard and inflexible stands in case of economic issues and policies. Since the foreign investors had made this Bill a test case, the government had taken the decision on the Bill on the eve of the winter session, Mr Advani said expressing a hope that foreign investment in the country would come at a faster rate.

The party and the government should not become a prisoner of "isms", Mr Advani said, adding that even those parties which in the past followed a certain ideological rigidity changed their course when confronted with ground realities. He quoted the instances of the Congress and the CPM, which did deviate from their long held economic policies and views.

The Finance Minister, who explained at length the issue, said that foreign investors would come to India after the Bill was introduced. Mr Sinha informed the members that the country’s economic situation was "critical". India needed $ 25 billion each year over the next 10 years for infrastructure development and this could be done only with foreign investments, he stressed.

Talking to mediapersons, the Parliamentary Affairs Minister, Mr Madan Lal Khurana, said that the decision to introduce the Bill would be taken in a day or two.

Clarifying that there was no deviation in the government policies, Mr Khurana said all allied parties barring the TDP and the Trinamool Congress, had been supporting the Bill as they had their representatives in the Union Cabinet. The government has already held consultations with the TDP, he said.

In an effort to further defend the Government’s decision, Mr Khurana said the Congress governments in the 60s and 70s had followed socialist policies but in the 1990s the Congress had started following the course of globalisation and liberalisation in line with changing international economic scenario.

He said the BJP MPs have been asked to pursue the allies' MPs to support the Bill, which would have far-reaching effects on the domestic economy.

While there was no limit for foreign investors in the earlier Bill, the Bill proposed by the Vajpayee government had fixed a ceiling of 26 per cent for foreign investors and another 14 per cent for NRIs and other investors. Another feature of the Bill was that dividend income would not be allowed to be repatriated to the foreign collaborators.

Mr Khurana said the government had decided to allow private participation in the insurance sector keeping in view changes in the world economy and as a part of continuation of economic reforms.

Later, at the regular party briefing which was addressed by the party General Secretary, Mr M. Venkaiah Naidu, along with Mr Khurana, it was stressed that all differences over the issue had been resolved after the meeting between the party leadership and the government last evening. The BJP was for a minority foreign equity participation, he said when asked if the party would support 26 per cent foreign equity in the insurance sector.

Admitting that there was a communication gap between the party and the government over the insurance issue, Mr Naidu said that the communication gap arose because of time constraint due to the recently held Assembly elections. The BJP had decided to set up a committee for ensuring coordination between the Government and the party at the Jaipur National Executive meeting.

Now it has been left to Mr Vajpayee and Mr Thakre to evolve a mechanism of such a committee, Mr Naidu said.

When asked if the BJP has bid goodbye to the swadeshi plank, a nonchalant Mr Naidu said: "Swadeshi would be there till we are there".

Several party MPs asked for the introduction of Bills for creation of separate states of Uttarakhand and Vananchal as the opposition parties were spreading the canard that the BJP was reneging on its promises. The Bills should be preferably brought in the current session of Parliament, they said.

Mr Advani said that he would consider the suggestion constructively.