Industry hopes the withdrawal of support will not affect reform process

Withdrawal of support by the Congress to the Deve Gowda government at a time when the Finance Bill is pending in Parliament and the export import policy is away just by a day, has surprised industry. But they are hoping that the reforms will continue regardless.

Says S Kasliwal, president of the Federation of Indian Chamber of Commerce and Industry, "I am surprised, but not shocked."

The FICCI chief expressed the hope that the Finance Bill would still be passed with minor changes and the economic policies will continue to support the liberalisation process, since these had the backing of most political parties. "Thus, industry would not be hurt," he said, hoping that there would be a smooth change of government.

"The stock market is bound to witness panic selling on Monday," said Paramjit Singh, president of the Delhi Stock Exchange. "But with election of the new leader and changeover of the government the market will bounce back."

The withdrawal of support by Congress, Singh feels, will not shock the stockmarket. His analysis is that political uncertainty always existed when a 13-party coalition government was in power, running with the outside support of the Congress and the Left.

However, with the historic Budget of Finance Minister P Chidambaram, foreign institutional investors were quite bullish about the Indian market. Analysts felt the euphoria created by Chidambaram's Budget was mainly responsible for the overwhelming response by the Videsh Sanchar Nigam Limited in the global depository receipt issue.