The Telegraph
Since 1st March, 1999
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Singh tackles Left on economic policy

New Delhi, Aug. 25: The Prime Minister’s Left allies were left with red faces for the second day today as Manmohan Singh dropped all pretence of trying to hide differences over economic policy.

He went ahead and announced his reform agenda, such as relaxing labour laws and allowing foreign investment in retail.

For the second day, he caused embarrassment to CPM leaders in Delhi by praising Buddhadeb Bhattacharjee’s government in Bengal and stressing how there were differences between the communists in Calcutta and in the capital.

CPM politburo member Sitaram Yechury bristled. “The Prime Minister has been very appreciative of our chief minister. We are telling him ‘please emulate him’.”

After saying yesterday Bhattacharjee is a role model for other chief ministers, Singh commented in an interview to a consultancy firm’s publication that Bengal realised the need for labour market flexibility.

“It is my task to carry conviction to our Left colleagues in Delhi. I haven’t given up,” he told the McKinsey Quarterly Journal.

In a change from his characteristic non-controversial style, the Prime Minister appeared determined to address difficult issues like labour market reform, public sector divestment and foreign investment in retail trade.

All three are anathema to the Left. Yechury evaded comment on labour reform, but said caustically: “Have land reforms. Empower the landless peasantry. That is what Bengal has done.”

Singh made a strong argument for labour reform, but added: “We don’t have the broad-based consensus in our coalition for me to assert that I can move forward in a big way.”

Gurudas Dasgupta, an MP belonging to the CPI, said: “We are alarmed at the Prime Minister’s statement.”

Singh also expressed hope that he would be able to get round the Left’s objection to foreign investment in retail trade.

“I am convinced that we can work out a package that is fair... that will not hurt our small shopkeepers but will create a lot more employment.”

The Prime Minister hoped that he would be able to persuade his “patriotic” Left colleagues.

Addressing Singh’s hint of differences in the CPM ' between Bengal and Delhi ' Yechury said Bhattacharjee had not deviated from the party’s principles.

The three yardsticks are that foreign investment is welcome if it increases productivity, creates jobs and upgrades technology.

“We want the (central) government to apply these same conditions,” Yechury said.

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