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Modi Agenda Scuttled by Partisan Gridlock, Key Bills Stalled

  • Opposition parties block business in tit-for-tat politics
  • Parliament winter session ends with little to show in 2015

India’s parliament shut its doors for 2015 in what was a frustrating year for Prime Minister Narendra Modi as opposition parties, emboldened by a recent election victory in a key state, blocked crucial bills in tit-for-tat politics.

Legislation on a proposed national sales tax, real estate regulations, as well as a new bankruptcy code stay stalled as the Indian National Congress and allies thwarted functioning of the legislature on issues ranging from corruption charges against leaders to claims of rising social strife in the nation. Modi’s agenda is at the mercy of the opposition in the upper house, where his party lacks majority.

“It’s very disappointing and sad to see opportunity gone again,” said Sudip Shah, London-based chief executive officer at Orbit Investment Securities Services Plc. “It’s going to be a tough way forward. Things will not happen in the near future.”

Parliament is now expected to reconvene only in February, putting at risk Modi’s plan to unify India’s 29 states under a single goods-and-services tax by April. The delays have hurt the nation’s stocks, which are among Asia’s worst performers this year.

"They are paralyzing parliament because they have a vendetta against people that they have rejected them and elected us," Venkaiah Naidu, a BJP member and parliamentary affairs minister, said of the opposition.

‘Political Vendetta’

The main opposition Congress party accuses Modi’s Bharatiya Janata Party of "political vendetta," after a BJP member filed fraud charges against Congress leaders in a case involving transfer of assets. While the BJP has denied involvement, saying it’s a private complaint, the case has dashed hopes of a compromise.

The parliament session was also rocked by allegations of financial irregularities in a Delhi sports body, which was at the time under the watch of Arun Jaitley, Modi’s close aide and current finance minister. Jaitley, who denies allegations of any wrongdoing, has filed defamation charges against leaders of the Aam Aadmi Party, which made the allegations.

“The political atmosphere in the country has been completely vitiated,” said Paranjoy Guha Thakurta, a New Delhi-based independent analyst. “If the government is serious of amending legislation, it can only do so by building a political consensus.”

Willful Obstruction

Not everyone shares that view. Modi has been conciliatory in reaching out to the opposition on the GST, said Ajay Bodke, chief executive office at Mumbai-based brokerage Prabhudas Liladher Pvt., who accuses the opposition of willfully obstructing parliament. Vaibhav Sanghavi, managing director at Ambit Investment Advisors Pvt., said the delays are "understandable" considering diverse views in a "vibrant democracy."

Modi has however seen some success toward the end of the session. Lawmakers on Tuesday passed a bill to tighten laws against teenagers accused of serious crimes such as rape and murder and on Wednesday approved another to hasten resolution of commercial disputes through arbitration.

“It’s a matter of time before important legislations are cleared," Sanghavi said.

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