CPI(M) against limit hike, not FDI: Yechury

Apparently worried about the effect his tough talk might have on the unity and longevity of the United Progressive Alliance (UPA), Communist Party of India(Marxist) leader Sitaram Yechury clarified that though his party was opposed to hiking foreign direct investment (FDI) limits in the telecom, insurance and civil aviation sectors, and the offloading of 5 per cent stake in the National Thermal Power Corporation (NTPC), the question of bringing down the government on these issues did not arise just yet.

In an interview to BBC, Yechury had said the government had no experience of the CPI(M)'s "bite" and if it persisted in following policies that violated the common minimum programme (CMP) it might find the experience unpleasant.

"We never said the support to the UPA government will be withdrawn. You cannot show a single government, which was supported by the CPI(M) and which fell due to withdrawal of support by the party," Yechury said during a debate on the Union Budget.

Reiterating that the Left was playing the role of a "watchdog" and not a "lapdog", he said his party had told the Manmohan Singh government about its opposition to increasing the FDI limit in the telecom, insurance and civil aviation sectors.

"We are not opposed to the FDI if it fulfills certain conditions but we are opposed to raising the FDI limit. We think all coalition partners are mature enough to understand this,"' he said.

To a question whether his party would withdraw support if the face-off between the government and the Left, the biggest outside ally, persisted, Yechury said, "we do not think such a situation will arise. It will be unfortunate if such a situation arose when we have to bite."

Yechuri said his party had wanted a secular government at the Centre and it would continue its support.

He reiterated the CPI(M)'s stand on the FDI: that it must add to the country's productive capacity and upgrade it technologically.

The FDI must also generate fresh employment. If it served the mutual interests of foreign capital and Indian economy, it was welcome, he said adding for every reform the yardstick should be whether it helped "our country".

Yechuri said in the US there was a cap on the FDI in telecom up to 26 per cent and in European countries it ranged between 30 per cent and 32 per cent. Why did not they allow FDI in telecom beyond a certain limit? he asked.

He said the argument that telecom needed foreign investment for expansion did not hold good since the country had already achieved the target of teledensity one year in advance. Yechuri said the decision to offload 5 per cent stake in the NTPC was not in line with the CMP.

He said his party would not have opposed the move if the board's objective had been to raise capital by selling five per cent equity.

He said that the union budget had some elements of human face and added that it was not sufficient. "Attempts should be made to balance between corporate profit and the people's welfare. One cannot neglect the latter," he said.