Tearing into the Centre's big ticket reforms, Tamil Nadu chief minister Jayalalithaa on Saturday described it as "diversionary" to "anaesthetise the mammoth corruption charges" against the UPA Government especially when elections seem imminent.
Cabinet clears FDI in insurance, pension sector
"The UPA government is unfazed by the sufferings of the common people, small traders and small farmers. This move at best is a gimmick and at worst an unworthy risk," she said in a statement two days after the Manmohan Singh government unleashed the second wave of reforms over FDI in pension and insurance sectors.
Strongly opposing these moves, she said they were detrimental to the future of common people of the country.
"The act of disguising harmful decisions and promoting them under the name of grand reforms amounts to deceiving the people of the country. No amount of rhetoric will change the truth," she said.
The AIADMK supremo lambasted the Centre when she said that its decision to hike FDI in Insurance sector to 49%, "against a Parliamentary Standing Committee recommendation will prove disastrous".
"As to whether they have the right to jeopardise this crucial sector is a debatable issue," she said adding limiting the capital requirement to Rs. 50 crore for insurance companies will lead to "mushrooming" of small companies lacking experience and capability and will be fraught with danger.
It will unnecessarily expose the public to the risk of uncertainty, she said.
Allowing FDI in pension funds and channelling the domestic savings of elderly persons into the highly risky and unpredictable capital market will place the future of senior citizens at tremendous risk, the chief minister added.
Jayalalithaa said the government's green signal to hike FDI ceiling in insurance sector to 49% from 26% and opening up the pension sector will be operational only if relevant bills were passed in Parliament where, she said, the UPA "faces a number crunch."
"FDI in the Insurance Sector will lead to the emergence and dominance of private insurance companies whose motives will be totally commercial," she said.
Consequently, public sector insurance companies like LIC, which participate actively in the developmental process, will "suffer", she said.
"As a result, the developmental process of the nation itself will be adversely and severely affected," the chief minister, who had earlier announced she will not implement FDI in multi-brand retail in Tamil Nadu, said.