NEW DELHI, Aug 6: Finance Minister P Chidambaram's proposal to open up the insurance sector to the private sector suffered a blow when the Government was forced to withdraw the Insurance Regulatory Authority (IRA) Bill.

Matters came to a head when the Bharatiya Janata Party proposed an amendment which would prohibit any foreign company from entering the insurance sector. With the the Communist Party of India-Marxist (CPM) certain to vote with the BJP and the amendment all set to sail through, the Government decided to withdraw the Bill rather than face a humiliating defeat on the floor of the House.

Sensing the mood of the House, Prime Minister I K Gujral declared that his Government would prefer to withdraw the Bill and persist with the policy of consensus. As of now, it is difficult to say when the Bill will be reintroduced, Chidambaram admitted to mediapersons later.

Although the Prime Minister had earlier suggested that the Bill be deferred in view of the differences leader of the opposition Atal Behari Vajpayee even accepted the offer the BJP later decided to harden its stand. Senior leaders attributed this to Chidambaram's ``mishandling of the situation'' and, as Vajpayee put it, his taking the BJP's support for granted.Ironically, no political party other than the CPM appears to be rejoicing. In fact, BJP leaders were at pains to point out that the blame lay entirely on poor floor management. As BJP leader Jaswant Singh told The Indian Express, ``Knowing that not enough Congress members were present, and knowing the stated position of the BJP, the Government could easily have deferred the Bill.''

United Front sources chose to describe the situation as one of a serious schism in the BJP, with the leadership supporting the Bill, and the rank and file opposing it. While expressing unwillingness to go into the issue of a rift in the BJP, Chidambaram told a select group of mediapersons that he had been in touch with the BJP all along and had got the impression that it would go along with a statement which would address their concerns. Ironically, the withdrawal of the Bill came after both the BJP and the Congress had supported the Government in defeating the CPM-sponsored amendment which opposed the opening up of the sector, per se. The amendment was defeated 228 to 43.

But this was just the beginning of the trouble. The Speaker, P A Sangma, admitted the BJP amendment although Chidambaram had argued that the IRA Bill was merely about giving the IRA statutory powers and thus the BJP amendment made little sense.

As the voting was about to begin, Chidambaram rushed to Vajpayee's seat with the request that the BJP not insist on the clause. Though the BJP leadership showed signs of conceding, BJP MPs led by Lodha, Murli Manohar Joshi, Sushma Swaraj, Pramod Mahajan and others kept up their tirade on opening up the insurance sector only to Indian companies.

Vajpayee's suggestion that government be given time to reconsider the matter and approach Parliament again to evolve a consensus drew howls of protest from his own partymen and the Samta Party MPs. George Fernandes shouted that the matter be put to vote ``here and now''. Perhaps realising that he had taken a precipitate step in allowing the amendment and forcing a vote, the Speaker, quoting a 1966 precedent, adjourned the House for lunch. This drew strong protests from Chandra Shekhar and Samta Party members who insisted that the voting process could not be terminated mid-way. This prompted the Left, Chandra Shekhar and others to demand that the Bill be withdrawn altogether. The hardliners in the BJP also insisted on withdrawal. This is the second time in three months that the UF government has suffered a serious setback. A Bill on reservation for women was introduced but was later sent to the select committee. When it came back, the government found itself faced with opposition from the treasury bench itself. As a result, the Bill could not taken up for consideration.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.