Insurance Laws (Amendment) Bill: What’s the way out for Narendra Modi-led NDA government?

Why The Insurance Bill Is Stuck...

The centre promulgated an ordinance after it failed to get RS to clear the Insurance Laws (Amendment) Bill 2008. Bill has to be passed in this budget session to prevent it from lapsing.

Since the NDA doesn’t have majority in RS, it wants to get the Bill introduced & passed in Lok Sabha, thus paving the way for convening a joint session to push the bill through. As per rules, if a Bill is passed in either House, govt can call a joint session. NDA has numerical superiority in a joint sitting.

As Bill is already pending in RS, it remains the property of that House irrespective of the ordinance. That mandates govt getting leave of the House to withdraw the pending bill before rerouting it through LS.

But govt can withdraw the bill only if that leave is granted by the House. So when government sought the leave for permission to withdraw the bill, the Opposition asked for a vote.

Knowing a trial of strength will lead to the defeat, Finance Minister Arun Jaitley avoided that embarrassment by ‘deferring’ the motion to withdraw the bill.

While withdrawing, he tactically claimed the rules allow the government to introduce ‘new bill’ straightaway in the Lok Sabha.

What Happens Now...

NDA has the option of — just as it had in last session — continuing to negotiate with Oppn for a give-and-take formula or try to divide rival camps. The passage of Bill is crucial as no insurance company would be willing to put its money unless there is legislative backing for reforms in the sector.