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Heavy economic agenda for Parliament
FM Chidambaram has lined up heavy economic agenda before Parliament during monsoon session, apart from presenting Union Budget.
Finance Minister P Chidambaram has lined up heavy economic agenda before Parliament during the ensuing monsoon session, apart from presenting the Union Budget.
That the Finance Ministry has readied at least eight bills dealing with banks, insurance and capital markets to pep up the investment climate and provide new avenues for investments by retail investors.
Most of the bills that lapsed after the dissolution of the thirteenth Lok Sabha will be given life and reintroduced during the session commencing next week. Chidambaram would reintroduce eight such bills, sources said.
He will pilot the Banking Companies & Financial Institutions (Amendment) Bill, 2004. Through this bill, the Government proposes to bring down the its holding in public sector banks and FIs to 33% from the current limit of 51%.
A reworked bill with specific provisions to retain the banks’ management control with the Centre would be proposed. Further, the bill would stipulate that the Government holding will be reduced through issue of fresh equity to retail investors rather than roping in a private domestic bank or a foreign bank as strategic partner.
This proposal is to placate the Left parties that are opposed to privatisation of state-owned banks and insurance companies. Public offer route to reduce the Centre’s holding has been committed in the CMP as well.
The bill will also provide for greater flexibility for professional managers in these banks to manage the day-to-day business decisions.
Chidambaram may also bring in the Financial Companies Regulation Bill, 2004 to effectively regulate NBFCs and protect depositors’ interests. The FinMin is also ready with the Banking Regulations Bill, 2004 that caps the voting rights of foreign investors in domestic private banks to 10% irrespective of the equity they hold in local banks.
Yet another legislation, the Banking Regulations Amendment and Miscellaneous Provisions Bill, 2004, may also be brought in to effectively regulate the cooperative banks. These banks are currently under dual control of the state and central governments. Once the bill is adopted, the RBI would effectively regulate these cooperative banks.
Chidambaram, according to sources, will also go ahead with demutualisation of stock exchanges and bring in penal provisions against market manipulators. The Finance Minister will pursue Securities Law (amendment) Bill 2004, it is learnt.
The Actuaries Bill, 2004 will also be revived to enable setting up of a statutory institute to develop the profession of actuaries. Sources said that the Finance Minister would seek the Cabinet’s approval before these bills are reintroduced in the Budget Session.
