PM Modi breaks ice with opposition, eyes thaw in GST deadlock

New Delhi: Addressing Parliament on Friday, Prime Minister Narendra Modi had said that the strength of a democracy is not imposing things through majority rule but by working with consensus.

It was a clear move by the Prime Minister to reach out to the Congress. With its reform agenda stalled in Parliament and no breakthrough on the GST bill, the government has realised that it is time the Prime Minister stepped in himself.

For the first time since he took over as Prime Minister, Narendra Modi invited Congress president Sonia Gandhi and former prime minister Manmohan Singh to discuss the GST bill.

Reacting to this, Congress vice president Rahul Gandhi said, "They are doing this under public pressure. We want a constitutional cap on GST because the poor should not be affected."

In the meeting with the Prime Minister, the Congress stuck to its three key demands.

According to sources, the government may agree to cap the GST limit at 18%. However, addressing the demand by the Congress to make it a Constitutional amendment is a tricky issue for the government.

The government may also agree to do away with the 1% levy for manufacturing states.

Meanwhile, it's clear that the opposition's demand to setup an independent disputes redressal system is unacceptable to the government.

Given the technicalities involved, the BJP reacted with cautious optimism.

"The Congress have put their stand before us and we have put our stand before them. We will see what can be done. The Congress will discuss it with their leaders as well," said Union Finance Minister Arun Jaitley.

Sources said that immediately after the meeting, Jaitley also spoke to leaders of opposition in the Rajya Sabha, Ghulam Nabi Azad and Anand Sharma, in another sign that the government wants to pass the bill as soon as possible.

"The bill must create a genuine market for the producer and the consumer. It should not be rushed through. We have raised serious considerations," said former Commerce minister Anand Sharma.

The government knows it well that it's high time the GST bill was passed, because the credibility of the Centre is now at the stake. While there is no immediate outcome, the fact is a dialogue has begun and the BJP will look to conclude these discussions successfully very soon.