The government’s surprise announcement Friday that it will allow foreign investment in retail and aviation and the sale of minority stakes in four state-run companies evoked sharp criticism from opposition parties and some of the ruling Congress party’s coalition allies. A day earlier, the government announced a hike in the price of diesel fuel.
Hundreds of supporters of the Hindu nationalist Bharatiya Janata Party held a rally in New Delhi demanding that the government reverse its decisions, saying they would hurt the poor.
Shouting “Down with Manmohan Singh’s government” and “Roll back the diesel hikes,” angry protesters climbed over barricades erected by police on the road.
They burned an effigy symbolizing what they called the “corrupt government” before
In Kolkata, the capital of West Bengal state, the top elected leader, Chief Minister Mamata Banerjee, led a large rally protesting the government’s economic reform policy.
Banerjee, a key coalition partner, gave the government 72 hours to reverse its decision to open the supermarket sector.
In Kerala state in the south, shops were closed and public transport was halted after opposition Communist parties and the BJP called a general strike.
Prime Minister Manmohan Singh defended the hike in diesel prices, saying it was “vital” for the country’s energy security.
“Our energy prices are out of line with world prices,” he said.
The government hiked the price of diesel after coming under intense pressure to reduce its fiscal deficit by cutting spending for subsidies, particularly on fuel.
But critics said the move will hit farmers who are dependent on diesel fuel to power irrigation pumps and tractors.