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Key party quits India govt protesting economic reform

Publication Date : 19-09-2012


Trinamool Congress, a key ally of India's ruling United Progressive Alliance (UPA) coalition, last night decided to withdraw its support from the government in protest at the recent big-ticket economic reforms and diesel price hike.

"Our six ministers will go to Delhi to resign. We will not stay in UPA II," Mamata Banerjee, head of the party, told reporters in Kolkata after an over three-hour make-or-break meeting of the party's parliamentarians and other senior leaders.

The six representatives, who are members of India's federal cabinet, will meet Prime Minister Manmohan Singh at 3:00pm on Friday and resign, she added.

The exit of Trinamool and its 19 lawmakers from the Congress party-led UPA does not, however, immediately threaten the stability of the government which still has the support of over 300 legislators and needs 272 to stay in power in the 543-member Lok Sabha, the lower house of the Indian parliament.

But it does make the government more vulnerable to whims of its other allies, most of which strongly oppose the surprise move to allow foreign investment in retail sector. It means Congress will now have to depend on so many other regional allies each of which has its own agendas.

Mamata Banerjee, a mercurial politician who has forced the Indian government into a series of policy reversals and led to scrapping of the proposed Teesta water sharing treaty with Bangladesh in September last year, assumed power in the state of West Bengal in May last year, ending 34 years of unbroken Left Front rule there.

Mamata, a populist firebrand leader said the economic reforms would hurt the poor. "Unfortunately, we have not received any respect from Congress despite being their important coalition partner."

She also accused the Congress of indulging in the "politics of blackmail".

Congress sources say they will be able to manage by calling on other regional parties such as Samajwadi Party led by Mulayam Singh Yadav or Bahujan Samaj Party headed by Mayawati from northern state of Uttar Pradesh. These two parties, which together have 43 lawmakers, are already supporting Congress-led UPA from outside.

Significantly, reacting to Trinamool's decision today, Samajwadi Party made it clear that it would not be influenced by Mamata's decision and would take an "independent" view.

There has been speculation for months about the possibility of early parliamentary elections before their scheduled date in 2014 because of tensions in the UPA coalition.

Decisions taken by the federal government last Friday to open airlines to foreign capital, limit use of subsidised cooking gas cylinders to six per year, sell minority stakes in four state-run companies and hike diesel prices have also drawn sharp criticism.

Opposition parties also sharply criticised the reforms, which were announced last week. Some, including the Hindu nationalist Bharatiya Janata Party and Leftist parties, have planned a countrywide strike and protests for Thursday.

There now appears only a small window for a rapprochement between Mamata and the government in the next three days.

While Mamata wanted total withdrawal of the decision on FDI in retail, raising the cap on subsidised cooking gas cylinders from six to 12 cylinders and reduction of diesel hike from 5 rupees (US$0.09) by 3 rupees or 4 rupees for reconsideration of her decision, Manmohan Singh appears to have decided to stick to his reform decisions.

Congress was unfazed by Trinamool's decision to withdraw support to UPA and maintained Mamata's party is "still a valuable ally" and said it will discuss with government the issues raised by her.

Sources said Congress President Sonia Gandhi was expected to take up the matter with the prime minister, amid indications that the cap on LPG cylinders could be raised from six to nine per year.

The next three days gives Congress and the government some room to work out a compromise, observers say.

For this, the government may have to climb down on its stand of not rolling back its last week's decisions.

Communist Party of India asked the UPA government to prove its majority in Parliament after the withdrawal of support by Trinamool Congress. But Parliament is not in session right now.

BJP said it would consult its NDA allies on whether there is a need for a special session of Parliament in the wake of Trinamool Congress' decision.

*US$1=53.99 Indian rupees)


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