Is a Congress Party win good for global commerce?

Now that we know that the Congress have won the general election with a comfortable margin, which allows them to be that little bit more confident in their agenda setting, the question that I’ve been most asked is whether a Congress victory is good for the international business.

If what a business leader most wants is stability, then I believe that the people have delivered a much more stable government than the last, which was run on the whim of the Communist Comrades of West Bengal.

We must also take some comfort in the fact that senior Ministers like Chidambaram and Kamal Nath have made statements that recognise that the reforms process must move forward – whether this is to do with labour reform or increasing FDI in various industry sectors. The latter is what I’d like to examine further.

Its proven that in sectors such as IT, biotech or telecom – which are ‘open’ to foreign equity and participation, we’ve seen huge growth – some commentators estimate around 40% growth year on year. Whereas in ‘closed’ sectors such as retail, legal services or accountancy, you’ve only seen single digit growth. The argument being that the more ‘open’ India becomes, the greater the chances of her becoming more competitive and successful.

Chidambaram has commented on the inadequate level of life insurance cover in India as being “totally pathetic”, and also often stated the need to bring reforms to the banking sector, does this mean that we should expect the reforms required to ensure that the Indian consumer gets more value for their money?

Well, without the Communists holding a gun to their heads, it seems that the Congress Party has a range of options to pursue to take the globalisation agenda forward. The international community expects it, and to be honest, I’m not sure the Indian Government will have any plausible excuses to defer critical economic reforms or on delivering on Doha much longer.

UK Outreach of the Communist Party Of India (Marxist)

At a time of political turmoil in India, where the Communists withdrew their support for the Congress led UPA Government in Delhi – which could lead to the rapid decline of the UPA and trigger a general election, we organised a private dinner for Comrade Biman Bose, Chairman of the Left Front, Member of the CPI (M) Politburo, and West Bengal Secretary of the CPI(M) with key political commentators and other opinion formers in London.

Regardless of what one makes of his party’s position on crucial subjects like the India – US Nuclear Deal, it was refreshing to hear him speak, and you had to appreciate the simple fact that he knew that he’d be in for a hard time on the evening but was nevertheless keen to engage. 

Despite the meeting being billed as ‘off-the-record’, he reversed this by agreeing to speak ‘on-the-record’, and since then has been at the centre of a story that’s found wings in which the journalist reports that the CPI(M) is willing to work with the BJP. A scoop!

Knowing political culture, both parties are sworn enemies but it doesn’t surprise me that they’re willing to speak with each other. One only has to look back at the toppling of the VP Singh Government in which both played a significant role in toppling that Government. For this reason, we shouldn’t be surprised.

With elections scheduled for early next year, If I were Sonia Gandhi, I’d be tempted to call an election sooner rather than later. Right now, they can make mischief by casting the BJP as the stumbling block to the country’s development by their objection to the nuclear deal. Later on, the effects of the slowing economy, double digit inflation etc are going to hit them for six. They’ve already lost key states and with several other key elections scheduled across India this year, which they’re guaranteed to lose – they don’t stand a hope in hell in returning back to office.

It was great to organise the Communist outreach in London. One of our guests even commented that it was good to hear Comrade Bose’s views at such an eventful time in Indian politics.

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