Despite the difficult political situation, finance minister Pranab Mukherjee today exuded confidence that “many” economic reform Bills would be passed by the first half of the coming financial year beginning April 1, depending on when the parliamentary committees examining these would give their reports.
“(On) at least three-four Bills for which we have received the recommendations of the standing committees, I will try to get those legislated in the later part of the (Budget) session,” he told reporters.
He was replying to a query as to how he could carry forward with reforms in the current political situation. Passage of the Bills, he said, would be taken up after the Finance Bill was cleared. Parliament is scheduled to go into recess towards the end of this month, reconvening after a break to clear the Budget.
For the rest of the Bills, if the Parliament committees report by the monsoon session, many would be cleared in the first half of 2012-13, he added.
“Yashwant Sinha (chairman of the standing committee on finance) is working hard... reports will be available at the beginning of the monsoon session,” Mukherjee said. Sinha’s panel has already given its report on the proposed Direct Taxes Code (DTC), the Insurance Bill, pension legislation and banking regulation.
It is to now vet a Bill to amend the Constitution to roll out a national Goods and Services Tax (GST) and a revised Companies Bill, among others.
In his Budget speech, the minister proposed to bring seven financial Bills in the ongoing session. These are The Micro Finance Institutions (Development and Regulation) Bill, the National Housing Bank (Amendment) Bill, the Small Industries Development Bank of India (Amendment) Bill, the National Bank of Agriculture and Rural Development Bill, the Regional Rural Banks (Amendment) Bill, the Indian Stamps (Amendment) Bill and the Public Debt Management Agency of India Bill.
The standing committee had rejected a key clause in the insurance Bill, to raise the foreign direct investment cap in private insurance companies from the existing 26 per cent to 49 per cent. It had also turned down a key clause in the banking Bill, to raise the cap on voting rights of a single shareholder in government-run banks to 10 per cent from the existing one per cent, and in other banks from the existing 10 per cent to a level proportionate to the stake.
On the DTC, it suggested much wider slabs and tax exemptions than suggested by the Bill. For example, it suggested the threshold of annual income be raised from Rs 1.8 lakh to Rs 3 lakh for the purpose of income tax. The government in this Budget had proposed to raise this limit to only Rs 2 lakh.
The fate of the pension reforms Bill is uncertain due to the opposition from the Trinamool Congress, the fractious constituent of the ruling United Progressive Alliance government. Today, the government defeated the Opposition-sponsored amendments to the President’s Address in the Lok Sabha, but the Trinamool walked out.
The finance minister said the economy was going through difficult times, but he was hopeful the collective wisdom of the nation would help address economic issues. “Merely chanting that these are difficult times will not help,” he said.