Opposition on warpath: Winter session will be a washout for Modi-Jaitley reforms

The winter session of Parliament, which started today (24 November), has a huge legislative agenda, but the ones most keenly watched will be the fate of the insurance bill (to raise FDI to 49 percent), the changes proposed to land acquisition, NREGA and labour laws (Factories Act and Apprenticeship Act), and the Coal Mines Nationalisation Act, which will have to be amended in order to comply with the Supreme Court decision to cancel all coal block allocated after 1994. In all, some 67 bills are pending in parliament for passing. Some newspapers seem to be suggesting that reforms may be round the corner. The Economic Times’ lead story in Mumbai today waxed eloquent with a headline that read: ‘Modi’s BULLet train set to roll out from Dalal Street’. This is an obvious pandering to market sentiment (note the BULL in the word bullet).   _Firstbiz_ quoted Finance Minister Arun Jaitley as indicating that a whole raft of second generation reforms may be coming soon, with the insurance bill and the goods and services tax (GST) being his immediate focus areas. [caption id=“attachment_1818935” align=“alignleft” width=“380”]  The main reason why legislation will not happen is our perennial election season – which will continue till February, when Delhi goes to the polls. AFP[/caption] My prediction is that the winter session will largely be a washout, and it is the budget session which may bring forth some forward movement on reforms. The insurance bill hangs by a thread, and its passage will depend largely on whether the Congress will back it in the Rajya Sabha. As for GST, it cannot even be introduced because the empowered committee of state finance ministers and the centre have not evolved any consensus on it. A GST bill is a constitutional amendment and will need a two-thirds majority – an impossibility without state concurrence. All the opposition to the BJP is coming from the states. So the earliest a GST Bill can make it to the legislative agenda is the budget session, and that too assumes a lot. The main reason why legislation will not happen is our perennial election season – which will continue till February, when Delhi goes to the polls. With the opposition parties banding together to block any legislation in parliament, the chances of a productive winter session are almost nil. The budget session is when we will know if any major legislation will pass. The smoke signals coming from the opposition were largely hostile yesterday (23 November), when the government had called the traditional pre-session all-party meet to discuss the agenda. Seven parties – BSP, SP, INLD, JD(U), the JD(S), the Left and TMC – have more or less decided to oppose all legislation proposed by the Narendra Modi government purely for political reasons. These parties have 60 MPs in the Rajya Sabha. Add the Congress’ 68, and together the opposition has 128 MPs in an upper house of 245 members. They can block any legislation if they band together. The NDA, in contrast, has only 56 Rajya Sabha MPs between BJP and its current allies. Even this is doubtful, if the BJP fails to get the Shiv Sena to back its line on legislation. In the 56, the BJP’s own strength is 43. Mint newspaper quotes JD(U) secretary general KC Tyagi as saying that “the JD(U), CPM, BSP, SP will together oppose the FDI hike in the insurance sector. We want the Congress party to support us for greater opposition unity.” The Economic Times quoted Congress spokesman Anand Sharma as saying that the land acquisition bill will face opposition. “Broadly, the session’s legislative agenda figured when the finance minister reached out to us. On land acquisition bill, I have told him that the concerns of the states may have to be addressed, more so, when it involves livelihood concerns.” Last month, Sharma had indicated that the Congress party would delay, if not oppose, the coal mines ordinance, too. What these statements and political postures suggest is that the Modi government will have to negotiate with the Congress to get one or two bills passed in this session (insurance, for example), but will face a united opposition in the remaining, more contentious, bills (where reforms can be called anti-poor). For Narendra Modi, it means deals will have to be made with the Congress and some of the less belligerent opposition parties (AIADMK, NCP and BJD) to get some of the legislation through in the winter session. It is, of course, possible for Modi to ignore the Rajya Sabha’s thumbs down and call for a joint session of parliament to pass some bills. But in this event, he will have to mollify the Shiv Sena, which has 18 MPs in the Lok Sabha, and is at daggers drawn with the BJP in Maharashtra. But the Rajya Sabha has power to delay bills. It can send bills to joint select committees, instead of just voting them out. This means no joint session can be called till the government’s bills are formally defeated in the Rajya Sabha. The options before the government are thus clear: One, the BJP can do a deal with the Congress on giving it leader of opposition status in the Lok Sabha, despite lacking the numbers, to get the insurance and coal mines bills passed in this session. This is priority, but it would need the government to climb down from its high posture on this issue so far. So we should take this deal as unlikely. Two, the BJP could accept the delay as inevitable. It can pass all contentious bills in the Lok Sabha, send them to the Rajya Sabha, get the joint committees to give their reports in time for the budget session, and then call a joint session of parliament to get them through finally. This is possible, but not easy. Not all bills can make it even by the budget session, since all national parties are busy campaigning in the state assembly elections till February. Three, the BJP can abandon all but the least contentious of bills till the monsoon session of parliament, and work on reforms through the administrative route. This is what is most likely. The inescapable conclusion is this: the winter session will be largely a washout, and real legislation will happen only during the budget and monsoon sessions of 2015. Reforms are not happening in this winter of discontent.