Congress party formally selects Manmohan Singh as leader

Описание: (19 May 2009)
Newly-elected Congress lawmakers formally chose Prime Minister Manmohan Singh as their leader on Tuesday, clearing the way for the swearing in of his new government this week following an unexpected victory in India's national elections.
Sonia Gandhi, the Congress party chief, proposed Singh's name and the lawmakers approved it without a vote amid clapping and thumping of desks, said the party spokesman.
Singh is expected to meet with President Pratibha Patil on Wednesday to stake his claim to form the new government.
The Congress-led coalition captured 261 seats in India's 543-seat Parliament, far more than most analysts predicted, but still 11 short of a majority.
On Tuesday, two key regional parties, Bahujan Samaj Party and Samajwadi Party, which together will control 43 seats in the newly-elected Parliament offered support to Singh.
In March, Gandhi said Singh will be the party's nominee for the top post for a second term if it was returned to power in national elections.
The announcement by Gandhi set at rest media speculations about the likelihood of her young son Rahul Gandhi succeeding Singh who is recovering from a heart bypass surgery.
The near-collapse of India's once-powerful Communist parties is expected to allow Singh to pursue key reforms in insurance, pension funds, banking and retail.
The Congress Party has governed for nearly 50 years of modern India's 62 years of independence.
Sonia Gandhi, the Italian-born widow at the head of the country's most powerful political dynasty, turned down the job five years ago.
She remains leader of the Congress party.
An economist and technocrat, Singh shifted the country away from decades of socialist-style policies and toward a more open economy when he was finance minister in the early 1990s.
But over the past five years, many additional market reforms that Congress backed were blocked by the Communists, which remained a strong force in Parliament.
In the election results, announced Saturday, the Communists lost more than half their seats.
With a free hand, Singh is likely to open India's insurance, retail and banking sectors to greater foreign investment.
The nation's pension regulator could also get proper legal standing, which would encourage greater investment.
And some steps might be taken to loosen hidebound labour laws, like allowing contract labour.
The Congress Party, however, is keenly aware that a third of India's 1.1 (b) billion people live in extreme poverty and more than 90 percent work in the informal, unorganised sector.
In his last term, Singh oversaw a costly initiative to guarantee employment to the poor in rural India and alleviate farmer debt.
But those programmes have added to the nation's already onerous fiscal deficit and antagonised factory owners who say workers have grown lazy on government aid.
India's total deficit this fiscal year could hit 11.4 percent of GDP, up from 5.7 percent last year, according to ratings agency Standard & Poor's, which has threatened to downgrade India's country rating to junk.

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