However, the decision on separate Telangana could cast a shadow on the Lok Sabha and the Rajya Sabha in the first few days with members from Andhra Pradesh agitated over the move likely to create uproar.
Several members from the Seema-Andhra region belonging to the Congress and Telugu Desam Party have tendered their resignations in protest against the decision, but they have not been accepted and the Congress leadership is attempting to persuade its MPs and ministers not to take extreme action.
Prime Minister Manmohan Singh has already sought Opposition's cooperation in the passage of the legislative business including the "most important" ordinance on Food Security Bill.
Promising to discuss all issues raised by the Opposition, Dr Singh has hoped that the session, which will conclude on August 30 will be "very constructive and productive".
There has not been any assurance from the Opposition. On Saturday, Finance Minister P Chidambaram reached out to the Bharatiya Janata Party for support to key reform bills on opening up the insurance and pension sector, but failed to get assurance. Chidambaram had a discussion with BJP leaders Sushma Swaraj, Arun Jaitley and Yashwant Sinha on the financial bills that have been listed for consideration during the session.
The BJP leaders agreed to support routine and necessary financial business but indicated that the party will continue to oppose further opening of the insurance and pension sectors to Foreign Direct Investment.
Swaraj, Leader of Opposition in the Lok Sabha, has demanded a debate on the current economic situation in the backdrop of the declining rupee, rising prices and slowing GDP growth. As many as some 40 bills have been listed for consideration and passage in the session, which will have only 12 working days and government has expressed readiness to extend the session if need be.
While Parliamentary Affairs Minister Kamal Nath has said that the government has received "emphatic assurances" from all political parties about the session being business-like and smooth, the Samajwadi Party, which is supporting the government from outside, struck a discordant note saying the session would not run smoothly and would be a stormy affair.
Amid turbulence in Gorkhaland after the decision on Telangana, the Trinamool Congress wanted a statement by Home Minister Sushil Kumar Shinde that now no new state will be carved out cautioning otherwise "India will burn". Several parties including the Dravida Munnetra Kazhagam and Trinamool, Rashtriya Janata Dal, Janata Dal-United have raised the issue of judiciary "interfering" in the work of legislatures and expressed concern over "erosion" of Parliament's supremacy. There have also been demands that the National Judicial Commission Bill, which seeks to lay down a new criteria for appointing judges, be brought for consideration and passage in this session itself.
Some parties have also sought amendment of the Constitution to rectify the recent orders of the Supreme Court including on barring persons behind bars even for a day during polls to contest and that of Supreme Court judgement regarding reservation in AIIMS faculty.
The BJP is opposed to the recent amendments to the FDI in retail and has demanded a debate on it. In the insurance sector, the government proposes to increase the FDI cap to 49 per cent from 26 per cent, which the BJP opposes. The main opposition party is also against raising the FDI limit in the pension sector to 49 per cent.
The main opposition party has also decided to raise the issue of confrontation between the Central Bureau of Investigation and the Intelligence Bureau and its implications on the country's security. The two central agencies had recently been on loggerheads on the Ishrat Jahan encounter case in Narendra Modi-ruled Gujarat.
Several notices have been given for discussion on various issues ranging from Chinese incursions, infiltration from across the border, mid-day meal tragedy in Bihar and Tamil Nadu fishermen issue. The government has already agreed for a discussion on the flash floods in Uttarakhand, which led to a massive tragedy in the hilly state as also a debate on economic situation.
Besides the insurance and pension bills, the economic agenda for the monsoon session includes the Companies Bill, Direct Taxes Code Bill and changes in the SEBI law. During the session, the Opposition is expected to raise the issue of government further easing FDI norms in various sectors and press for detailed debates on the matter. The government earlier this week decided to raise FDI caps in sectors such as telecom (from 74 per cent 100 per cent), power exchanges, petroleum and natural gas sector and courier services, besides easing sourcing and investment norms for multi-brand retailing.
The government managers have already expressed their readiness to discuss any issue, which may agitate the opposition. "We are not shying away from discussing any issue," Minister of State for Parliamentary Affairs, Rajiv Shukla said.
As demands for new states rose in various regions including the demand for Gorkhaland in West Bengal, Trinamool Congress has demanded that the home minister issue a statement that no other state would be created.
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