Standing his ground

The Prime Minister deserves to be complimented for standing firm on the issue of oil product prices, despite the spectacle of his own Congress party joining the chorus of protest from the Opposition. As all the news trickles out, it is clear that the Cabinet's decisions on oil pricing have gone further than just the price hike; some structural deficiencies in oil price calculations have been corrected, and the oil companies have been given pricing freedom once again. Building on the Rangarajan committee's recommendations, Dr Manmohan Singh has therefore undone most of the damage of the last four years (since price decontrol was sabotaged, first by Ram Naik and then by Mani Shankar Aiyar). Rolling back prices after making these changes would have signalled lack of will and loss of nerve. Dr Singh has done well to stand his ground.

Reports suggest that this signals a new phase in Dr Singh's occupancy of South Block, and a determination to not be pushed around by the recalcitrants in his own party and by the meddlesome allies in the Left. If so, this is welcome and indeed long overdue; his unwillingness to be his own man has been slowly destroying Dr Singh's prime ministership and the country has been losing time on critical reform issues. But the proof of this new determination will be in the decisions the government takes. One straw in the wind is the decision to push ahead with the disinvestment programme, which is welcome. Another will be the view that Dr Singh finally takes on job reservation in the private sector.

It should be expected that a more assertive Dr Singh will provoke reactions, from the Left and from Congressmen wedded to the old ways. When the decibel level rises, as it must, one question will be whether the Left is willing to pull the plug on this government. Another will be the stance that Sonia Gandhi adopts. Will she continue to block Dr Singh on economic reform issues and insist simultaneously on her own more politically-driven agenda being pushed through, and will Dr Singh then give in? Or will she sense Dr Singh's frustration and give the Prime Minister the space to function in the areas where his judgment is better than almost anyone else's? It would be hazardous to predict the outcome, but positions will be taken in the coming weeks and they will influence the future course, and perhaps fate, of this government.