Insurance: Left shows signs of hardening stand

Given the present equations in the Lok Sabha, it is unlikely that the changes proposed in the cap on FDI in the insurance sector can become a reality unless the UPA government takes the support of the BJP.

Left-affiliated trade unions have already opposed liberalisation of the insurance sector in unequivocal terms. Given its vulnerability on the issues of economic reforms after the events in Nandigram, the CPI(M) is showing every evidence of a u-turn.

The last issue of the CPI(M)'s organ, People's Democracy, had debunked the Budget as a document only for "stock operators and monopolists".

To keep its own flock together and under pressure from allies, the CPI(M) leadership may find it easier to take the line of least resistance and give in to the party's old guard, which is comfortable with centralised economic planning.

The Congress, however views things a more optimistically. A top leader told Business Standard that given the Congress' backing to the CPI(M) over the Nandigram issue, at the cost of its own interests in West Bengal, the Left party might be persuaded to cede a little ground at the Centre.

BJP leaders, however, say the Congress does not need to genuflect before the CPI(M) only because it wants to get the insurance Bill passed.

"The BJP may oppose 49 per cent FDI in insurance just for the sake of opposition, but we had contemplated a similar move when in government. We understand that investors need to have a comfort level, which can be achieved only if the FDI cap is upped," said a BJP leader.