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Trinamool Congress, a key regional party, has pulled out of India's coalition over economic reform plans.
Trinamool Congress, a key regional party, has pulled out of India's government coalition over economic reforms that would open India's retail sector to global chains, the BBC reported.
West Bengal Chief Minister Mamata Banerjee said that six of the party's ministers would resign from the coalition on Friday. The BBC said Banerjee is also angry over high fuel prices and said her 19 members of parliament would not back the coalition.
The New York Times said, "Her decision does not mean that India’s government will fall immediately, but it makes the governing United Progressive Alliance’s grip on power very tenuous." Without Banerjee's support, the governing coalition will need to rely on its other regional parties remaining in power.
Agence France Presse noted that the United Progressive Alliance II coalition is led by Prime Minister Manmohan Singh's Congress party, but it depends on Trinamool for a majority in parliament.
"The government has lost their credentials. If they cannot keep their friendship with us, they cannot keep it with anyone," said Banerjee, in Kolkata, according to Reuters.
AFP reported that Banerjee said, "Unfortunately we have not received any respect from Congress despite being their important coalition partner," adding that she believed the reforms would hurt the poor.
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Reuters said Congress party leader Sonia Gandhi had weighed the risk of losing allies before the government pushed forward with the reforms, according to party and government officials.
The main dispute involves policy changes which include allowing foreign direct investment from international giants such as Walmart and Tesco, and a 12 percent hike in diesel prices.
The prime minister and Finance Minister P. Chidambaram said the changes are needed to cut state spending and attract foreign investment, according to AFP.
"We continue to consider Mamata Banerjee our valuable coalition partner. We will discuss all the issues raised by her," said Congress spokesman Janardhan Dwivedi, according to AFP.
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