India economy flounders amid parliament impasse

A total impasse in India's parliament is not only undermining the world's biggest democracy but also deepening its economic woes as long-awaited reforms fall by the wayside. A now familiar chorus of recriminations echoed around the grandiose circular chamber on Friday as the second of the three annual sessions ended in paralysis. Faced with MPs from the main opposition BJP party shouting and waving papers, the parliamentary speaker called an end to proceedings shortly after midday. The BJP has been demanding the resignation of beleaguered Prime Minister Manmohan Singh over a scandal involving the awarding of coal mining concessions in his first term as premier, which has come to be dubbed "Coalgate". Auditors say the concessions were handed out too cheaply and in a process that lacked transparency -- heaping more embarrassment on the main ruling Congress party and Singh in particular who was in charge of the coal ministry at the time. Once widely admired as the architect of reforms in the 1990s that transformed the Indian economy, Singh now finds his latest legislative plans thwarted at every turn. In the latest "monsoon" session which began on August 8, lawmakers spent just 25 out of a possible 120 hours considering legislation, according to PRS Legislative Research, a New Delhi-based independent study group. Only four bills were cleared by both houses of parliament, despite as many as 30 being listed for consideration on issues such as pensions, land acquisition, tax reform and corruption. "The coal scandal has changed the entire political and economic complexion of the country," Arun Kumar, chairman of the Centre for Economic Studies and Planning in New Delhi, told AFP. "The victim of this deadlock is the economy which has been stopped from getting back to growth," Kumar said adding that lawmakers had unanimously ignored their "real business" which, is to "pass bills and introduce reforms". "They are holding back India's economic growth story." Singh, not normally known for his temper, made a rare outburst to reporters as he expressed his frustration on Friday afternoon outside parliament. "We take pride in the fact that since independence we are a practising, functioning democracy. What we have seen in this session is a total negation of that," said the 79-year-old Congress party veteran. While few commentators believe the BJP really wants to force elections before the scheduled date in spring 2014, the Coalgate revelations have put further wind in their sails at a time when the economy is experiencing a sharp slowdown. India's economy grew by 5.5 percent in the second quarter of the year against a figure of eight percent over the same period in 2011. The BJP, a right-wing Hindu nationalist party which lost power in 2004, has been unapologetic about its wrecking tactics, saying the protests were necessary and that obstructing parliament was a legitimate measure. "We are fighting for a cause," Sushma Swaraj, the leader of the party in parliament, told reporters. "Bills were not passed in the house... we are aware of that but the fight against corruption is more crucial for the nation," she said, outlining how the party now planned to organise more anti-government street protests. Political pundits warn that a bigger economic storm is brewing and if the lawmakers do not pass the crucial bills in the next session then several sectors of the economy will plunge into crisis. Since independence in 1947, India has basked in its image as the world's biggest parliamentary democracy but analysts say that the legislative deadlock and the prospect of politics being played out on the street do not bode well. "A deeper crisis is clearly visible. There is a complete breakdown of communication between the ruling and the opposition parties," said Sanjay Kumar, a researcher at the Delhi-based Centre for Study of Developing Societies. "If this trend continues, there will no reforms and the growth story will see an ill-fated painful end." Backroom dealers from both the main parties now have around 10 weeks to see if they can thrash out their problems and ensure that lawmakers get down to some real business when parliament resumes for the final winter session of the year. As it stands, the just-finished monsoon session will be remembered as a complete washout. "This monsoon session will be remembered for no work," concluded Hamid Ansari, the chairman of the upper house of the parliament, as he suspended the session on Friday.