Mumbai: Criticized for being lethargic, government is rushing to salvage its image. In less than a month, the government has taken a series of steps to reinforce confidence in public and business community. Starting with the fuel price hike decision on 24 June, the prime decision making body, the group of ministers, took decisions on the Cairn-Vedanta deal, and sugar export quota. The panel also agreed on clauses in food security, mining bills and released the draft micro finance bill.
The government also achieved a breakthrough on the Goods and Services Tax front. Read more...
While the Committee of Secretaries is expected to meet on Friday to discuss a proposal to allow up to 51% FDI in multi-brand retail, the new rural development minister is aiming to put up the land acquisition bill draft online this week for public debate. Read more...
Even though the pace of decision-making has picked up analysts are skeptical about the government’s ability to continue the momentum.
Rakesh Arora and Arjun Bhattacharya of Macquarie note:
There has been a spate of policy decisions from the government lately that are aimed at clearing the pile ahead of the monsoon session of the parliament and UP elections next year. We believe these decisions are being made not only to ward-off the negative publicity that has surrounded this government but also to address issues around the burgeoning fiscal deficit. In our view the government has not fared well in making these decisions as some of them appear superficial – the cabinet reshuffle for instance.
The skepticism stems from past experiences. Despite promising to act, several key finance bills are stuck in the parliament. The Banking Amendment Bill, Companies Bill, Insurance Laws and Pension Fund Regulatory and Development Authority Bill are some of the bills that are waiting for parliament approval. With the monsoon session of the parliament set to begin from 1 August, the focus will shift to the passage of pending bills. Read more...
Some of the Pending Bills in Parliament
• The Prevention of Bribery of Foreign Public Officials and Officials of Public International Organisations Bill, 2011
• The Regulation of Factor (Assignment of Receivables) Bill, 2011
• The Pension Fund Regulatory and Development Authority Bill, 2011
• The Protection of Children from Sexual Offences Bill, 2011
• The Mines (Amendment) Bill, 2011
• The Labour Laws (Exemption from Furnishing Returns and Maintaining Registers by Certain Establishments) Amendment Bill, 2011
• The Constitution (One Hundred and Fifteenth Amendment) Bill, 2011 (GST Bill)
• The Banking Laws (Amendment) Bill, 2011
Source: Macquarie Research