Fiis Sceptical Of Bjps Promises

The BJP election manifesto may have a darker side to it, s section of the foreign institutional investors (FIIs) feel. FIIs are of the view that issues like protectionism for Indian industry and conscious reduction on foreign dependence which feature high on the political agenda of the party, may be a ``political gimmick at present, they could find a stronger thrust to it if the party comes to power after the elections.

If the party were committed on moving on this line, several reform-based issues could find confrontation with the WTO and only affect the economic mood of the country in coming times, a section of the FIIs say.

 

A source at a European-based investment bank says, ``The point is that the party must decide on the economic outlook for the country...the country at this stage requires foreign funds. The country has the potential to become a major force but the governments should also be realistic on some issues, .

The party is trying be a shade different from the rest of the parties in the fray. We belive the BJP manifesto is addressed mainly to those who have the voting power rather than the money power. Though they have talked about protecting the domestic industry, there is not plans to increase tariffs, said a foreign fund manager.

In fact, some of these fund managers had recently met the BJPs think tank to understand partys view point. We got a clearer picture when we actually met them. The party functionaries convinced us that the tariffs would not be raised nor would the taxes be. Thus the manifesto looks more of a lipservice. Also BJP will have to seek support from other groups if they want to form a government, thus their decision making will not be independent, informed the fund manager.

The FIIs argue that the smaller splinter groups on which BJP may have to eventually depend are off shots of the previous ruling parties. Thus there will be nothing much that the party can do independently on crucial issues relating to foreign investments.

The market will be anxiously looking forward to BJPs first economic policy after it comes to power. Till then there will be nervousness and the FIIs will prefer to watch from outside, said a FII fund manager.

The FIIs are of the view that no matter which party comes to power the clock cannot be reserved. They however reiterate that the pace of reform should not lag. Eventually there will not be much of a difference, the fund manager said.

More over, after having seen some elections we are confident that the manifestos really do not make a difference, said the fund manager.