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August 1, 2010

In Parliament

The sixth parliamentary session during the UPA government’s second term is being held between July 26 and August 27. The government managed to fulfil only a small part of its stated legislative agenda last session, and may attempt to take up some of those bills this session.

It is not clear whether the government would be willing to take up the Women’s Reservation Bill in Lok Sabha. The bill was passed by Rajya Sabha in March but several parties that support the UPA government are opposed to the bill. Though the bill will likely muster a two-third majority support with the aid of the BJP and Left parties, the Congress party may be reluctant to offend its UPA allies.

The Nuclear Liability Bill has been referred to the standing committee which is scheduled to submit its report on the second day of the session. This bill sets a mechanism for no-fault liability in case of nuclear incident from a nuclear power plant, and sets maximum liability limit of SDR300 million (about Rs 21 billion) with the operator’s liability capped at Rs 5 billion with the rest to be borne by the Union government. [See the May 2010 issue of Pragati for an analysis of this bill]. The BJP and Left parties have opposed the bill, and it would be interesting to see whether the government makes some amendments that address the issue related to the liability cap.

The National Advisory Council (NAC) chaired by Sonia Gandhi has recommended a Food Security Bill. At the initial stage, every household in one fourth of the most disadvantaged districts or blocks will have access to 35 kg of food-grains per month at Rs 3 per kg. In other districts, a similar facility will be available to vulnerable groups including scheduled castes and scheduled tribes while all others would be entitled to 25kg of food-grains at an appropriate price. There would be a category that would be excluded based on transparent and verifiable criteria. The NAC has recommended that the bill be drafted based on these principles. This bill is unlikely to be introduced this session.

The NAC has also commented on the Communal Violence bill, and recommended several changes. This bill, pending in Rajya Sabha since 2005, increases penalties for crimes committed during communal violence, provides for fast-track courts, and for compensation and rehabilitation of victims. The government may choose to redraft the bill before taking it up in parliament for consideration and passing.

Three ordinances have been promulgated since the Budget Session.  The first ordinance supersedes the Medical Council of India with a new board for a period of one year. This move followed the arrest of the head of the council on corruption charges. The second ordinance was issued after a spat between the securities and the insurance regulators related to unit linked insurance products (ULIPs). The ordinance sets up a mechanism to resolve disputes between financial markets regulators, and clarifies that ULIPs and similar products would be regulated by the insurance regulator. The third ordinance amends the Enemy Property Act, 1968 with retrospective effect to keep the enemy property vested with the custodian even if the original owner has ceased to be an enemy, or whose legal heir is an Indian citizen. These ordinances will lapse if parliament does not ratify them.

The Prevention of Torture Bill was passed by Lok Sabha in the Budget Session and is pending in Rajya Sabha. This bill defines torture as grievous hurt caused by a public official with the intent to extract information. Any complaint has to be filed within six months of the act of torture. Prosecution requires prior sanction of the Union or state government to which the accused public official belongs.

Several important bills have been pending for the last few years. In the last session, the agriculture ministry circulated amendments to the Seeds Bill, 2004, but the bill was not discussed. The amendments have addressed many contentious issues including exemption from registration of inter-farmer sale of seeds and requirement of special approval for genetically modified seeds.

The government has been silent on the bills related to financial markets. These include a bill to provide statutory backing to the pension regulator, bills related to insurance markets, a bill to permit options trading in commodities and a bill to regulate micro-finance institutions. It is unlikely that these bills will be on the agenda during this session.

The finance ministry has issued a paper discussing the feedback on the draft Direct Taxes Bill. Many controversial clauses have been dropped including the minimum alternate tax on assets, tax at withdrawal of certain savings and pension schemes, presumptive tax on house rent, and voiding of double taxation treaties. Given that the finance minister has expressed his desire to bring the new tax structure in force by the next financial year, the revised bill could be introduced this session.

Other than the legislative agenda, parliament will likely discuss several issues of national importance. The opposition will likely raise the issue of pricing of petroleum products following recent policy changes. Though headline inflation as well as food inflation have been creeping down, the current double digit levels could induce yet another discussion on price rise. The proposal to permit FDI in multi-brand retail stores could also be discussed. Other discussion issues could include the recent foreign minister-level talks with Pakistan and the situation in Jammu & Kashmir.

Parliament may also see a rare event—the impeachment of a high court judge. Two cases related to Justice Soumitra Sen of Calcutta High Court and Chief Justice P D Dinakaran of the Karnataka High Court have been referred to inquiry committees. Press reports indicate the inquiry committee looking into the Justice Sen case is close to finalising its report. It is possible that the issue may figure in Parliament this session. In this context, it is important to note that a new Judges Inquiry Bill was introduced in 2006 which has lapsed.  Last year, the law minister stated his intent to enact the Judicial Standards and Accountability Bill, but it is yet to be introduced.

The UPA government had announced an ambitious legislative agenda through the President’s address in July 2009 and February 2010. While political opposition from allies—as in the case of land acquisition bill—may make it difficult for the government to push through some bills, we hope the government uses this session to redeem at least part of its pledge.


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