India Insight

(Any opinions expressed here are those of the author, and not necessarily those of Thomson Reuters)

Just last week, the Congress-led coalition government overcame legislative deadlock in parliament by agreeing to and winning a symbolic vote on allowing foreign companies to invest millions of dollars in India’s retail businesses.

But a week is a long time in politics. Parliament reached another impasse, and the press returned to nouns that it usually associated with parliament — uproar and furore.

The impasse was about Wal-Mart’s disclosure of a U.S. lobbying bill of around $25 million, which includes activities to facilitate its entry into the Indian retail market.

The Bharatiya Janata Party (BJP) and others from the opposition wanted the government to investigate whether bribes were paid in India — although as WSJ India bureau chief  Paul Beckett writes, “what the BJP claims is the bribery of Indian officials is actually an effort by the U.S. government to provide full disclosure about what companies are doing when it comes to contacts with U.S. legislators”.

Not surprisingly, the Reserve Bank of India (RBI) kept the repo rate on hold on Monday, just days after the Congress-led government dropped a cluster bomb of several reform measures on “big bang Friday”. #gallery-1 { margin: auto; } #gallery-1 .gallery-item { float: left; margin-top: 10px; text-align: center; width: 33%; } #gallery-1 img { border: 2px solid #cfcfcf; } #gallery-1 .gallery-caption { margin-left: 0; }

Though most experts thought that the RBI would not cut rates on Monday, markets were hoping that central bank governor Duvvuri Subbarao would oblige them just a little bit. The Sensex ended 78 points higher, but was up 200 points in anticipation.

Considering the state of the Indian economy and governance, the reforms did not merit immediate rate action. Market and economy watchers should be patient and wait for FDI — “foreign direct investment” — approvals to go through.

As soon as former Bharatiya Janata Party president and political veteran Lal Krishna Advani announced that his role in the party and the Sangh Parivar “is much more than the post of prime minister” — he made it pretty clear that he may not be the preferred BJP candidate for the prime minister’s post in the 2014 general elections.

And soon the media and most political analysts made a pretty safe guess that the party would back current Gujarat Chief Minister Narendra Modi as its next PM candidate. Yet others named Sushma Swaraj and Arun Jaitley as strong contenders.

But a lot may happen between now and 2014. And as things stand currently, our next PM may be a coalition leader from one of the regional parties. Let us examine why.

Leaders from India’s influential corporate industry on Friday expressed solidarity with Anna Hazare in his campaign for a tough anti-corruption ‘Lokpal’ bill, joining ranks with thousands across the country galvanised by the activist and his Gandhian method of non-violent agitation.

Word about Hazare, who is on a fast until death, has spread through television, SMSes and social media sites such as Facebook and Twitter, drawing thousands of protesters on to the streets across various cities at a time when stories of mass corruption are dominating the media.

The government is under increasing pressure to resolve the impasse with protesters, who are now demanding that their nominee head a team to draft the Lokpal bill, before the agitation takes on new dimensions and the health of Hazare deteriorates.

Ashok Chavan and Suresh Kalmadi have been let go by the Congress. Who will be next?

The scams laid at the government’s door do not end with the Commonwealth Games in Delhi and the war homes scandal in Mumbai.

The opposition and the media, having tasted blood with Shashi Tharoor, Chavan and Kalmadi, now have Telecoms Minister Andimuthu Raja in the crosshairs over the sale of 2G spectrum.