DMK lowers threat, stays put in UPA for now

Sensex recovers, but closes 262 points down, as uncertainty recedes.

The hectic talks to defuse tension between the Congress and the Dravidra Munnetra Kazhagam (DMK) yielded partial results. The latter’s ministers at the Centre did not submit resignations to the prime minister on Monday, as planned.

Despite tough talk by DMK, the Congress is confident that even if its ally in Tamil Nadu quits the ruling alliance, there is no threat to the government. The Samajwadi Party, with 22 MPs, is seen as a potential replacement for 18 MPs of DMK.

DMK has decided to withdraw its ministers from the UPA government due to differences over seat-sharing for the coming state elections.

As political uncertainty at the Centre engulfed the markets, the Sensex fell more than 400 points early in the day. In the afternoon, as reports about patch-up efforts came, the index recovered some ground and closed 264 points down at 18,222.

On the political front, the Congress asked its chief troubleshooter, Pranab Mukherjee, to woo DMK.

Several calls were made between Chennai and New Delhi, starting with a call from Mukherjee to DMK patriarch M Karunanidhi.

The first sign of thaw came after the DMK ministers postponed their appointment with the prime minister from 11.40 am to 6:30 pm. Before 1 pm, while the prime minister was having lunch, Mukherjee called up to say the ministers would not resign on Monday.

In a manner not unlike at multilateral fora like the World Trade Organisation, the two sides first started working out the terms of the negotiations.

DMK set its terms: The Congress could not get more than 60 seats and dictate the choice of seats. The ruling party said if DMK fixed an alliance with the Pattali Makkal Katchi first and then ran out of seats it was free to give, it was not the fault of the Congress.

According to the negotiators in the Congress camp, DMK acted “tough”. It reminded the Congress that the demand for grants was yet to be passed. The party also recalled its commitment to UPA in the face of serious provocation, including that a government it was supporting had put one of its leaders in jail.

The Congress, on its part, said it supported the DMK government in Tamil Nadu and sought nothing for itself. Moreover, it had suffered from the taint of corruption charges against DMK leader and former telecom minister A Raja – by association. Despite this, it continued to back DMK, said the Congress.
 

BUT WITHDRAWAL SYMPTOMS REMAIN

The day that was...

8 am: Finance Minister Pranab Mukherjee calls up DMK chief M Karunanidhi and asks him to stop his ministers from resigning.

11 am: Mukherjee, Home Minister P Chidambaram, Health Minister Ghulam Nabi Azad and Sonia Gandhi’s political secretary, Ahmed Patel, meet.

Noon: DMK’s Dayanidhi Maran meets this group. Calls made to Chennai. Dayanidhi goes out to meet M K Alagiri, Karunanidhi’s son and Union minister. DMK says its ministers will not meet the prime minister today.

12:45 pm: Mukherjee informs the prime minister that the ministers will not resign today.

1 pm: Mukherjee meets Sonia Gandhi.

5 pm: Mukherjee, Chidambaram meet. Calls made to Chennai. Till evening, Karunanidhi continues to act tough. The Congress sticks to its demand for 63 seats.

9 pm: Alagiri, Maran meet Sonia Gandhi

Home Minster P Chidambaram, the Congress’ chief negotiator in Tamil Nadu, was with Mukherjee. While he is seen as someone not very keen to carry the DMK along, Mukherjee is in favour of continuing the alliance.

While the Congress’ compulsions are clear – it wants the Budget to be passed and does not want to be reduced to surviving on the support of dubious allies like SP and the Bahujan Samaj Party to make up for DMK’s 18 seats (DMK’s exit will bring down UPA’s strength to 254 while it needs 272) –DMK has its own compulsions. A three-cornered contest in the state will only help the opposition, the Anna Dravida Munnetra Kazhagam (ADMK). Fighting against both the Congress and the powerful ADMK alliance could decimate DMK.