Money Matters - Simplified

Manmohan firm on reforms, defies resistance from allies and Opposition

Prolonged multifaceted resistance towards implementation of governmental reform-policies may retard nation’s economic growth by 5 percent, warns Prime Minister Manmohan Singh.

A string of governmental reforms directed towards reviving growth and preventing credit rating relegation have been strongly resisted by Opposition and coalition members alike.

To protest against PM’s upcoming reforms – like propelling FDI in retail and diesel-hikes to cut subsidies – both Opposition and key allies took to the streets on Saturday.

Mamata holds a protest rally
Meanwhile, Trinamool Congress (TMC) leader Mamata Banerjee has also threatened that her party may have to withdraw ministers from the government lest the Cabinet fails to stop foreign players in retail and roll-back diesel price hike.

In support of her party convictions Ms. Banerjee held a protest rally in Kolkata and set a 24-hour deadline for the Prime Minister to rollback his reform plans.

Unlike her earlier threats, Ms. Banerjee was mum on whether her party would consider withdrawing direct support to the government, the TMC leader rather reiterated she would continue an outside support if TMC’s grievances are left unheard.

To quote what Ms. Banerjee said in a rally in Kolkata, "We demand a rollback of diesel prices and no FDI (foreign direct investment) in retail should be allowed. Do not attack the livelihood of small traders."

PM stands by his reforms
Amid all the upheavals and resistance, PM Manmohan Singh swore in a Planning Commission meeting yesterday that despite all the hurdles his team will take “courage and risks” to work in the full strength to achieve success.

The Planning Commission meeting, which Mr. Singh was attending, finalized India’s five year investment target ending March 2017 over which the Commission has envisaged an 8.2 percent of annual growth.

Meanwhile, investors around the world, who hailed PM’s stand on opening up of FDI in Indian retail, have started doubting whether the nation’s scam-tainted government would really be able to pull through its plans or would as usual succumb to political pressures.