With parliament victory, UPA on firmer wicket

Published: 08th December 2012 05:48 PM  |   Last Updated: 08th December 2012 05:54 PM   |  A+A-


The consolation which the Bharatiya Janata Party (BJP) is trying to derive from the fact that the Congress is in a minority in the Lok Sabha on the issue of FDI in the retail sector, although the ruling United Progressive Alliance (UPA) won by 253 votes to 218, is only a solace for the mind with little political consequence. The scope for mental relief has been further diminished by the UPA's victory in the Rajya Sabha.

It isn't only that numbers matter in a democracy but also the winning combination, especially where no single party has an absolute majority. The Congress trumped the BJP on both counts since the latter could not muster enough votes to carry its motion on FDI, and also because the BJP's failure was due to the unwillingness of those, viz., the Samajwadi Party (SP) and the Bahujan Samaj Party (BSP), to stand by it although their opposition to FDI echoed the BJP's position.

Yet the SP and the BSP calculated that staying away from the BJP was politically more profitable than allowing Wal-Mart and other international retail giants to enter the Indian market to the supposed disadvantage of the Indian shopowners. The SP's and the BSP's reasoning was that proximity to the "communal" BJP would alienate their minority vote banks, comprising both Muslims and Christians, whose numbers are estimated to be larger than that of the disaffected shopowners.

Only the Left did not think that its base among the minorities will be affected by its closeness to the BJP. In the case of the communists, it is evident that their ideological antipathy towards FDI in retail, which they see as the front paw of neo-imperialism, is stronger than their desire to hold on to minority support.

In addition, the Left's anti-Congress animus is fuelled not only by politics but also by the belief that the Congress is playing the neo-imperialists' game. The comrades are seemingly not bothered by the fact that by lining up with the BJP, they are bolstering the "communal" elements. For them, the Congress is the bigger enemy, and the enemy of the enemy, the BJP, is, therefore, a friend.

A similar mindset persuaded two other "secular" regional parties, the AIADMK and the Trinamool Congress, to vote against the FDI along with the BJP although they camouflaged their action by saying that the government was anti-poor. While the AIADMK's stance is explained by the fact that the Congress is in alliance with the DMK in Tamil Nadu, where the two Dravida Kazhagams are mortal enemies, the Trinamool Congress has no option but to adopt a stridently pro-poor position to outflank the commissars in West Bengal where it has recently defeated them after a three-decade-long battle.

The perception of the economic reforms being against the poor is a legacy of the 1947-1991 period of a controlled economy when socialistic views prevailed. Among the Congress's supporters, the SP and the BSP are still guided by these beliefs. However, what the voting trends emphasised was the kind of political imperatives which motivated the various parties. Therefore, the point to note is whether the Congress will be able to retain its allies. As of now, the possibility is high - and can become more durable if Narendra Modi's success in Gujarat in the assembly elections strengthens the BJP's communal image.

With the SP and the BSP expected to continue providing outside support, the UPA is now better placed than the BJP-led National Democratic Alliance (NDA). Considering that this is the NDA's second defeat in a parliamentary contest - the first was on the nuclear deal in 2008 - the UPA's position is obviously more secure. What is more, it does not seem to have been affected by the allegations of scams which it has been facing for more than a year.

If the success in 2008 was a watershed in the realm of foreign policy with India abandoning non-alignment and forming closer ties with the US, the latest parliamentary victory is a thumbs-up for reforms and an end of the Congress's earlier socialistic preferences. Even if there are roadblocks ahead because of the BJP's cussedness which may come in the way of the legislation on insurance, pension funds and banking, the earlier dithering by the Congress on reforms, mainly because of resistance from the "socialists" in the party, can be said to have been largely overcome.

While the green signal for FDI in retail should have a positive impact on the investment climate, giving a boost to the economy in the run-up to 2014, another factor which will help the UPA is the new policy of direct cash transfers to the needy. The scene for the Congress is, therefore, brighter than what it was a few months ago.


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