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EXPRESS NEWS SERVICE
NEW DELHI, DEC 7: Just when it seemed that the government had worked out an acceptable compromise to resolve the differences between hardliners and moderates in the BJP over the Insurance Bill, rifts appear to have cropped up within the party. The meeting of the BJP's central office bearers at the Prime Minister's residence ended tonight without the expected announcement of a consensus.
The one-hour meeting stretched to three hours leading to speculation that it had been a stormy affair and that the PM was unable to convince hardliners of the need to dilute their swadeshi stand. The scheduled media briefing was abruptly cancelled with a terse announcement that it would be held tomorrow afternoon instead. The BJP's Parliamentary Party, which includes several MPs who are opposed to the Bill, is scheduled to meet tomorrow morning.
In the afternoon, it appeared that the hawks within the BJP had backed down in the face of Prime Minister Atal Behari Vajpayee's determination to push the controversial Billthrough. In a sudden turnaround, BJP President Kushabhau Thakre issued a statement appealing to all MPs belonging to the party and allied partners to ``fully back'' the Bill since the Cabinet had taken a unanimous decision on the issue ``according to its own best judgement of the compulsions of the economy''.
Coming as it did on the heels of the open resentment expressed by Thakre and other senior BJP leaders, the statement seemed to be calculated to defuse the crisis brewing in the BJP by sending a signal that the issue had been sorted out; and that an announcement to this effect would be made after the central office bearers meeting tonight.
BJP leaders in the government launched damage control measures earlier today after Thakre's statement. Vajpayee is believed to have approached RSS chief Rajju Bhaiyya to call off the swadeshi hawks so that his government could fulfill a Cabinet commitment.
Home Minister L K Advani and Parliamentary Affairs Minister Madan Lal Khurana are learnt to have spoken toThakre this morning. Advani is also said to be talking to RSS leaders.
Khurana told journalists this afternoon that the Bill would be introduced this week in its present form and that amendments would either be appended or be brought in later.
Under the compromise worked out by senior BJP leaders and RSS leader K S Sudarshan, the cap on all foreign equity is expected to remain at 26 per cent. While the Cabinet had cleared a foreign equity participation of 26 per cent, it had also said that foreign institutional investors (FIIs), overseas corporate bodies (OCBs) and non-resident Indians (NRIs) would be allowed to hold an additional 14 per cent. The insurance bill, however, only talked of the 26 per cent figure, while the NRI-FII-OCB holding was to have been announced later, through an executive order.
Under this scheme, however, theoretically, it was possible for foreigners to hold 40 per cent equity in firms that entered the private sector. Last week, a senior BJP leader met Sudarshan to work out acompromise formula after protests from the RSS and its affiliates threatened to compromise the bill.
It was then decided that while FIIs and OCBs would be allowed to hold 14 per cent equity, this would be subject to the overall 26 per cent cap for foreign investors. Only NRIs would be allowed to hold 14 per cent. The bill which will be introduced in Parliament later this week will put the cap on all foreign equity at 26 per cent.
The Congress is believed to have conveyed to the Government that it favours foreign participation in insurance in principle but it wants to see the Bill before giving a final OK.
Although the Government had claimed through last week's storm that the Bill was still being drafted, today Khurana stated that a copy has been submitted to the Speaker. It will be circulated after the Prime Minister gives the green signal.
Another Sangh organisation, the Laghu Udyog Bharati, declared today that its members will oppose the proposed policy ``tooth and nail.'' Interestingly, anotherSangh affiliate, the Vishwa Hindu Parishad, today refused to comment on Home Minister L K Advani's description of the Babri Masjid demolition as ``singularly unfortunate''.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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