Advani dubs UPA-II 'illegitimate', forced to withdraw remark

Advani admitted that he made a mistake by speaking about UPA-II and what he actually intended to say was the 2008 vote of confidence secured during the UPA-I

New Delhi: The monsoon session of Parliament started on a stormy note on Wednesday when Bhartiya Janata Party (BJP) leader LK Advani triggered an uproar by dubbing UPA-II as 'illegitimate' but was forced to withdrew the remark after strong protests from Congress led by Sonia Gandhi, reports PTI.
"The UPA-II is illegitimate. It has never happened in the history of India .... crores of rupees were never spent to get votes," Advani said, provoking the treasury benches during a debate on an adjournment motion he had moved on the recent violence in Assam.
The Congress President and UPA chairperson displayed some unusual aggression in the Lok Sabha when she made clear that she would not countenance Advani's description of the government and egged on members of the treasury benches to demand its withdrawal.
The House was locked in uproar as BJP members launched a counter attack but Gandhi had one simple demand. "Withdraw, withdraw one word, withdraw," she said signalling the whole matter could be resolved.
The noisy scenes were witnessed when Advani, who was allowed to move his adjournment motion on the Assam violence, courted trouble in his speech when he said "I consider UPA II is illegitimate".
Gandhi's protest and and her message to the ministers and the Leader of the House Sushil Kumar Shinde was enough signal for the Congress and other UPA MPs to rise to their feet demanding withdrawal of the word. 
Advani's attempt to convince the House that he was not referring to the government after the 2009 elections but to the 2008 confidence vote in the House on the nuclear deal issue for which "crores of rupees were spent" to save the government.
This did not not cut ice with the Congress and UPA members who demanded that the BJP veteran withdraw the remarks.
As an angry Gandhi was demanded its withdrawal, Leader of Lok Sabha and Home Minister Sushilkumar Shinde appealed to him to withdraw the word.
"Advani is a senior leader. We all respect him. But today he has said the entire (2009) election was illegitimate. This is an insult for all of us. I think he should withdraw his words," Shinde said in his first intervention as the Leader of the House.
The Speaker also reminded Advani that she had allowed adjournment motion as people were concerned about the situation in Assam.
"But one word used by you has hurt the sentiments of everyone. If you want, you can withdraw it."
Advani admitted that he made a mistake by speaking about UPA-II and what he actually intended to say was the 2008 vote of confidence secured during the UPA-I.
"My comments were on the confidence vote and not on election. ... Those who were whistle-blowers were sent to jail," he said, "I withdraw the word illegitimate."
With the din continuing, the Speaker adjourned the House for lunch. When the House reassembled after lunch, the Speaker observed that Advani has withdrawn those remarks and they would not form part of the records. 
Responding to the vociferous protests by Congress, DMK and Trinamool Congress members, Kumar had earlier asked Advani to withdraw his remarks and said she would go through the records and expunge any objectionable or unparliamentary word.
Before the adjournment, the senior BJP leader said he was referring to the alleged cash-for-vote scam that saw BJP MPs displaying wads of cash in the Lok Sabha during debate on the confidence motion, which they claimed was paid to them for voting in favour of the government.
The Treasury benches, including ministers, were on their feet protesting Advani's remarks, with Parliamentary Affairs Minister P K Bansal forcefully pointing out that Advani was digressing from the issue on which he was allowed to speak.
"He has made extraneous remarks which has denigrated the Parliamentary system, the people and democracy," Bansal said.
Leader of the Opposition Sushma Swaraj clarified that Advani had not raised any unrelated issue and was only pointing out the failure of the government on economic and social fronts, including checking infiltration in Assam.
Even after the adjournment, the atmosphere remained surcharged in the House with Gandhi, who is also the UPA Chairperson, seen interacting with MPs and ministers.
Tempers were also frayed in the Opposition benches with some of BJP members accusing the Congress of making a mountain of a molehill and dragging the matter in spite of a senior leader like Advani withdrawing his words.
Some BJP members also warned that the House would not be allowed to function smoothly if the Congress attitude remained as it was today.


Only four states indicate support for FDI in multi-brand retail

So far, only Delhi, Manipur, Daman & Diu and Dadra Nagar Haveli have indicated support for FDI in multi-brand retail trade

New Delhi: Only four states and Inion Territories (UTs) have so far indicated their support for allowing foreign direct investment (FDI) in multi-brand retail, a development which will further delay entry of global chains like Walmart and Carrefour in India, reports PTI.
"Till date, written communications, indicating support for FDI in multi-brand retail trade, have been received from the governments of Delhi, Manipur and from Daman & Diu and Dadra Nagar Haveli," Minister of State for Commerce and Industry Jyotiraditya Scindia informed the Rajya Sabha today in a written reply.
The Department of Industrial Policy and Promotion (DIPP) had written to governments of all states and Union Territories on 19th June to elicit their views on the contentious issue.
The Union Cabinet had decided on 24 November 2011 to allow 51% FDI in multi-brand retail, but the same could not be implemented in the face of strong opposition from UPA-ally Trinamool Congress and several state governments.
Scindia said there was no proposal to allow 100% FDI in multi-brand retail.
In the backdrop of the government facing flak from a section of industry and some global investors for policy inaction, the government has renewed its efforts to forge a consensus on opening the retail sector estimated to be over $600 billion.
"No decision has been taken in the matter," he said.
In reply to a different question, the minister said that the government has not taken any decision on the two proposals for 100% FDI in the single brand retail. 
While Swedish furniture major IKEA proposes to invest Rs10,500 crore, UK-based footwear major Pavers wants to invest additional Rs100 crore in the Indian market.
Till May, the total FDI equity inflows in the single brand retail trade are meagre Rs204.07 crore.


RBS too is bullish and expects Nifty to touch 5,700 by year-end

RBS Private Banking India has released a report wherein it expects the RBI to cut rates by 50 bps and expects the market to touch 5,700 by year-end and finds Indian equities undervalued

Investors can look forward to Indian equities outperforming in the second half of 2012 on the back of an expected change in policy stance, RBS Private Banking India said in its Mid-Year India Outlook 2012 report released today. RBS, like Morgan Stanley, is also bullish on India’s prospects, and expects the National Stock Exchange’s (NSE) Nifty index to hit the 5,700 mark by December 2012. So, is there a bull market on the cards, despite considerable headwinds? What can investors expect?

According to the report, RBS values equities at 12.8 times one-year forward earnings, which is less than the ten-year historical average of 13.8. The global investment bank has assumed 15% earnings growth over two years. Likewise, on a price-to-book basis, Indian equities are trading at 2.1 times against the ten-year historical average of 2.8 times. RBS advises investors to “maintain their allocations close to recommended levels rather than sit on the sidelines.”

The bank has recommended high dividend yield stocks in this kind of environment and cites that equities are discounting at 16% on the dividend yield basis. In addition to high dividend yield stocks, it has come up with a 15-stock basket themed “Indian Olympians” based on certain criteria such as high profit, ROE, ROCE, etc. However, it is not known what the exact composition is.  Sector-wise, it prefers “interest-rate sensitive” sectors such as financials, consumer discretionary, automotive, healthcare and IT companies. It is negative on telecoms and consumer staples. Over and above this, it has preferred large caps over mid-caps.

The trigger for interest-rate sensitive securities to outperform is interest rates. The investment bank expects the Reserve Bank of India (RBI) to cut rates by 50 basis points. RBS chief investment officer Rajesh Cheruvu said, “We believe that prevailing macro conditions make strong fiscal action more effective than early monetary action. Going forward, lower commodity prices should ease headline inflation, and weakened domestic gold demand will support the current account and in turn aid the currency and inflation.” RBS also thinks that the government could partially deregulate diesel and liquefied petroleum gas prices.

Apart from equities, the investment bank prefers corporate bonds over government bonds as the latter has already run up considerably while corporate bonds have remained sticky. Also, it expects a spread compression between corporate bonds and government securities, and recommends high quality names. Again, specific names of were not given.

Rupee-wise, RBS has forecast the rupee to strengthen to 52 per dollar. The Indian rupee has depreciated by 8% this year. However, the appreciation of the rupee is contingent on strengthening of the capital account, and this would mean easing of macro-economic conditions such as fiscal deficit, reduced gold imports leading to reduced current account deficit, falling oil prices and initiation of reforms processes. Reforms process would be contingent upon the government’s ability to implement the land acquisition bill, mining regulations, authority for accountability in the civil administration and progress on the Goods and Service Tax (GST) and Direct Tax Code (DTC) towards implementation in 2014.

On a global scale, the bank expects policy action from China and other emerging markets, including India, to “support growth over the next few months”. Prateek Pant, director, Products and Services, RBS Private Banking said “Europe holds the key to the performance of financial markets for the coming half of the year. We believe that flare-ups in the Eurozone will continue, but would be met by policy response. Although financial markets are expected to remain volatile, coordinated policy action in the Eurozone, combined with domestic policy progress should see Indian equities continue to outperform in the second-half.”

If all of this does not pan out, RBS sees the Nifty going down to 4,900 levels, if the US growth slows further, the size and form of QE3 disappoints, domestic issues like policy paralysis continues and monsoon fails to pick up.


We are listening!

Solve the equation and enter in the Captcha field.

To continue

Sign Up or Sign In


To continue

Sign Up or Sign In



The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)