'Parl will decide future reform process'

Nomura

The Winter Session of Parliament, beginning tomorrow, will be a key gauge of the way some recently announced economic reforms are to be implemented and would decide the direction of future reform process, global investment banking Nomura said today.

"Our worry is that even a discussion on FDI in multi-brand retail will lead to heated debates and could lead to disruption in parliamentary proceedings. If the debate on

FDI in multi brand retail is put to rest soon, we would hope that other reforms will also be passed," Nomura said in a research note ahead of the Winter Session.

"However, the Monsoon Session of Parliament does not inspire much confidence as the standoff between the government and the opposition parties on issues of graft and corruption led to a complete washout of the parliamentary session.

"There is a risk that the Winter Session could go down the same road. Overall, the winter session of parliament will be a very important gauge as to the extent to which the announced reforms are being implemented," it added.

Some of the reforms announced since September that will come up for approval during the session include higher foreign investment ceilings in insurance and pension sectors, Companies Bill (Amendment), 2011 for improving standard of

corporate governance and Banking Laws (Amendment) Bill to pave the way for the RBI to give new banking licenses.

Other pending bills include Land Acquisition Rehabilitation and Resettlement bill, Direct Tax Code Bill, Forwards Contract (Regulation) Amendment Bill, and Competition Act (Amendment), 2002 to bring all sectors under the purview of the Competition Commission of India, except stressed banks or insurers.

"The direction of reforms in the coming months will depend on whether the ruling government becomes stronger or weaker out of this winter session," Nomura said.

The monsoon session of parliament was virtually washed away on the issue of CAG report on coal block allocations.

... contd.

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