December 9, 2011 4:32 pm Neil Munshi
It was another massacre.
As if it weren’t already clear that India’s ruling Congress party’s ability to enact meaningful reforms had died an early death, Thursday night offered up fresh kills in the form of three key reforms.
The latest casualties before a parliamentary committee were: a universal identification bill that proponents believed would enhance banking and the distribution of government welfare for the poor; a bill that would give investors in banks voting rights in line with their shares rather than the current 10 per cent cap; and a bill that would raise the cap on foreign investment in the insurance sector to 49 per cent from 26 per cent.
Each bill had faced opposition, even from within the government itself. But their resounding rejection Thursday night showed that Congress’s efforts to prove it wasn’t suffering from policy paralysis have fallen flat.
The defeat of the insurance bill – long contemplated by Congress and seen as a way to bring in much-needed foreign capital into the economy – was yet another sign of parliament’s lack of enthusiasm – to put it politely – for foreign direct investment.
The banking bill was given some hope of reprieve, with the committee suggesting voting rights be capped at 26 per cent.
As for UID, as the identification scheme is called: its proponents say that by consolidating ration cards and other government welfare schemes, along with biometric data, it has the capacity to cut down on the graft that runs rampant in rural India.
The Unique Authentication Authority, set up to get the scheme running, is headed by billionaire ex-Infosys CEO Nandan Nilekani. UID is the pet project of prime minister Manmohan Singh (pictured) and has the backing of Congress party scion and possible future PM Rahul Gandhi. In a more politically favourable time for the party, that kind of backing might have been enough to keep it from being dismissed outright.
No longer.
Instead, on all three reforms, “there was hardly a murmur of dissent with only Congress MP Rashid Alvi suggesting the UID bill be returned to government and not rejected,” according to the Times of India.
That idea, too, was killed.