Trinamool Congress chief and West Bengal chief minister Mamata Banerjee on Tuesday evening announced after 3-hr party meeting in Kolkata that her party decided to withdraw support from UPA government on the issue of diesel price hike, LPG cap and the FDI multi-brand retail decisions by the central government.  

Ahead of the crucial meeting of Trinamool Congress (TMC) parliamentary party, prominent leader Saugata Roy on Tuesday indicated that party could pull out its ministers from the Union council of minister if its  rollback demands on FDI in retail, cap on LPG subsidy and diesel price hike were not met with.

Withdrawal of support from the government was, however, not discussed, Roy, also Union minister of state for urban development, told PTI.

"Mamata Banerjee has not said anything sort of withdrawal of support. We will take a tough decision if the Centre does not accept our demands. We have two committments - to fight the anti-people decisions of the UPA government and to see the stability of the government. We have to strike a balance between the two," he said.

He said the Centre was yet to make any offer to Trinamool Congress chief Mamata Banerjee.

"Hard decisions would be taken if the Centre does not accede to the demands (of Trinamool Congress). There will be no soft compromise. We do not bark but we also bite".

Asked to comment on Union finance minister P Chidambaram's statement that the government will not roll back the decisions he said "We know the Prime Minister has the last word."

Trinamool Congress sources said the parliamentary party meeting would be an extended one with several senior party leaders and MLAs including the state ministers attending it. 

Trinamool Congress (TMC), a regional party based in West Bengal state and led by firebrand politician Mamata Banerjee, has been a thorn in the side of Prime Minister Manmohan Singh's administration since elections in 2009.

Banerjee has already described the reform package as "anti-people", saying a hike in diesel prices will spur inflation and that the opening of the retail sector to foreign multi-nationals will hurt millions of small traders.

Last December, Banerjee's refusal to accept retail reforms forced the government into a humiliating U-turn but the policy was re-launched last week.

"If the (government) does not roll back the hike in diesel price and withdraw decisions in multi-brand retail, we will take decisions, however hard they may be," she told crowds in Kolkata at the weekend.

The TMC, which has six ministers in the government and 19 MPs in the 543-seat Parliament, is due to meet in Kolkata town hall on Tuesday and make an announcement later in the day.

Manmohan Singh insists the diesel price rise and economic reforms are needed to reverse a slowdown in economic growth and to boost public finances.

On Friday, his cabinet cleared new rules inviting foreign supermarkets such as Walmart into the retail sector and allowing foreign airlines to take stakes in domestic carriers.

The measures came soon after diesel rates were raised by a steep 12 percent, sparking protests across the country.

Banerjee has said she does not wish to topple Manmohan Singh's government, while finance minister P Chidamabram on Monday expressed confidence that the reforms would be pushed through.

"I do not think that the government is facing any threat," Chidamabram said. "There are allies both in the government and outside. I am confident that they will continue to support us."

Trade unions, backed by the main opposition Bharatiya Janata Party (BJP), have called for a nationwide strike on Thursday. (Hindustan Times)