For now there is little threat to the Government falling. However, opposition party BJP has been obstructive in the past by paralysing Parliament in the last session and many allies have proved unreliable. This could result in a turbulent passage for more controversial economic bills like insurance and pensions. Uncertainty about success in parliament for these bills becoming law has contributed to the recent stock market rally fizzling out. The economic bills can be passed in Parliament's lower house (Lok Sabha) with the support of the two big regional parties that are not within the coalition, but have pledged support from outside the coalition. However, one of them - the Samajwadi Party (SP) - has previously opposed the insurance and pensions bills. The other party - the Bahujan Samaj Party (BSP) - is being coy about its voting intentions. Even if the two bills are passed in the Lok Sabha the hurdles are not over. The Government is in a minority in the upper house (Rajya Sabha). So, it needs the support of the main opposition party, the BJP, which is unlikely to help. A turbulent passage is expected for the insurance and pension bill and there is no certainty of success in them becoming law at long last.
David Fuller's view India currently shows a respectable 22% gain in USD terms this year and this week has seen an impressive upward dynamic. The government's newly found energy, and reintroduction of pro-growth policies have clearly attracted investor support.
India remains the largest overall position in my personal investment portfolio. After a long period of underperformance, it is now moving like a potentially dynamic growth economy once again.