Sinha under pressure from within

new delhi: finance minister yashwant sinha has come under pressure to review the cut in interest rates with the bjp’s draft economic resolution for the forthcoming meeting of its national executive at goa demanding a review of the controversial proposal. a significant section of the party, which is unhappy with mr sinha’s failure to guard its vocal middle class constituency, will also ram in the point that mr yashwant sinha cannot continue with his “cussed approach.� although the bjp’s resolution will take care not to send out the impression that the party has lost its appetite for reforms, the message will be clear — mr sinha will have to make some important concessions for winning back the middle class. for the finance minister, this is bad news as it will be interpreted as the party’s lack of confidence in his ability to blend good politics with economics. with the political situation getting more complicated for the bjp, the anti-reforms section within the party — a group that has been marginalised for sometime now — is sure to blame reforms for the party’s debacle in the just-concluded elections. already, party leaders of the states where the bjp experienced electoral meltdown are on record blaming “hard measures� in the budget for the party’s poor performance. a section of the sangh leadership is also unhappy with the vajpayee’s government’s economic strategy and it was only last weekend that dattopant thengdi, a rival of the prime minister in the intra-sangh politics, called the finance minister “an agent of the wto�. the development does not augur well for the vajpayee government in general and the finance minister in particular. in the short run, it will put severe stress on the finance minister and he could find it difficult to ensure the integrity of the budget. in the medium run, the attack on the economic policies of the government could embolden mr vajpayee’s marginalised anti-reforms ministers to harp on their pet agenda. as a matter of fact, this had its manifestation in the last cabinet meeting where the prime minister had to give a go by to the recommendations of the committee on agricultural cost and prices and effect a hike in the msp for rabi crops. but what could be worrying for the government leaders must be its impact in the long run. they will have to ensure that the anger against the budget does not translate into a lack of faith in the reforms process. and if that happens, it could be a repeat of 1994 when mr manmohan singh, who was blamed for the congress’ defeat in state elections, put reforms in the back-burner.