Politic-Economic-Society-Tech

Indian PM offers to resign

New Delhi — Indian Prime Minister Atal Behari Vajpayee offered to resign on Tuesday as charges flew over the crisis engulfing the country's largest mutual fund manager. 

Parliamentary Affairs Minister Pramod Mahajan told reporters that the 74-year-old prime minister made his offer during a meeting with lawmakers from his Bharatiya Janata Party (BJP). Party colleagues persuaded him to stay on. It came amid criticism of his fruitless peace-seeking summit with Pakistan earlier this month and a furore over the massive losses incurred by state-controlled Unit Trust of India (UTI). 

Opposition parties have harangued Finance Minister Yashwant Sinha over UTI for weeks, blaming him for failing to avert a crisis which they say ruined millions of small investors. There has also been sharp criticism over UTI from members of Mr. Vajpayee's coalition government, the National Democratic Alliance (NDA). On Tuesday newspapers said a key coalition partner, the Shiv Sena, had linked Mr. Vajpayee's office to the affair. 

Mr. Mahajan made no reference to the UTI row in his statement on Mr. Vajpayee's offer to step down, and insisted that the issue had not been discussed at the meeting. 

“At the BJP parliamentary party meeting this morning Prime Minister Vajpayee did express his desire to quit office in view of his inability to have the NDA function in a coherent and disciplined manner,” Mr. Mahajan said. “The party members reacted sharply to the PM's remarks and in one voice said that Vajpayee could not be allowed to leave.” 

As Mr. Mahajan spoke, Mr. Sinha was defending his ministry in the upper house of parliament. However, he was prevented from continuing with his speech because of heckling by opposition deputies who demanded that Mr. Vajpayee answer charges laid against his office, and the upper house was adjourned for several hours. 

Earlier this month UTI froze redemptions of its flagship scheme US-64 following a steep fall in its value. The decision was a big blow to some 20 million investors of the US-64 scheme, which had been viewed as a safe investment. 

UTI Chairman P.S. Subramanyam resigned soon after the crisis erupted and the Finance Ministry named a bureaucrat to head the fund management company, which was set up by parliament in 1964 to raise funds for the country's industrial development. 

UTI has 41 million investors in its 87 funds and manages assets worth 575 billion rupees ($19-billion Canadian). 

source:: www.globeandmail.ca, July 31, 2001