part of: SCAMS,
POLICY HANDICAP, ILL-INTENT, ELECTORAL MILEAGE
- THE POLITICAL JAMBOREE CALLED INDIA
DO NEED SUBSIDY MR. MANMOHAN SINGH
given the mindset at the moment, they won’t. Today, the Supreme Court
opinionated in the ‘2G Judicial Reference’ case hearing that its verdict about
auctioning natural resources was not applicable to all the natural resources. Soon,
the government sprang into action and Kapil Sibal was flashing into cameras giving
his wisdom of ‘enormous clarity’ on SC’s opinion. The ‘enormous clarity’ in his
opinion cleared all the misdeeds on natural resources allocations including the
can he thump his feet when the SC reiterated its auction-stand on the 2G
spectrum allocation scam? Does SC’s opinion today exonerate the UPA of the
‘enormous clarity’ of Mr. Sibal and his colleagues in the government didn’t
tell them the courts could still hear the natural resources allocation on
case-to-case basis including the Coalgate.
fiscal deficit illogic: Now this is what Manmohan’s main problem is evident
from his September 21 speech. The way he spoke, it told us that his diesel, LPG
and FDI decisions would wipe them out. Be sensible folks. There are no such
immediate prospects for an urgent crisis situation (as Manmohan has told us). I
would like to quote from some reports here.
current account deficit is over $70 Billion. The target this year is around Rs.
5,10,000 Cr0re (or approximately $98 Billion)
year, government had failed its fiscal target. 4.1 per cent was planned but
5.76 per cent was the final figure. This year too, the story is expected to
remain the same. Projections say it is expected to reach at 5.8 per cent
against the planned 5.1 per cent as emerged in a Reuters poll of 25 eminent
economists. Being an analysis, it may change and government can sight this but
the ground realities tell the same story.
is in no position to lower down the expenses keeping in mind the 2014 elections.
So whatever Manmohan says just contradicts him that bold decisions were
mandatory as the country was heading towards a 1991 crisis. Seeing all this,
the immediate measures being taken at the cost of taking risky and political
decisions might be nothing more but an effort to generate fund to fund the
pre-Budget populist measures.
helps politicians in another way. Industrialists finance big-ticket expenditure
like elections of the political parties. A report from the Association for
Democratic Reforms and the National Election Watch tells names of many
corporate houses donating to the political parties. Apart from that, the major chunk
of the thousands of crores of income of the political parties comes from anonymous
contributions. (Do you remember a political party representative approaching
you with a receipt book in hand requesting for a donation to the party?)
elections in India
is big event costing tens of thousands of crores (in absence of electoral
reforms) and any political party cannot raise that much by donation simply.
It has to business houses. Therefore, the government cannot antagonize the
industrialists by writing off the taxes. So find some other way to fill the
government’s currency chest – and the readymade victim the Manmohan’s ‘aam
aadmi’. Already burdened, burden him some more. After all, what the poor fellow
can do except getting worried about the reducing value of his meager income.
and his illogical doublespeak!
Even Raghuram Rajan, India’s new economic adviser to the
finance ministry told the country should not show excessive hurry in
controlling the deficit as it may impede the development process. In a
different interview to the Economic Times, he refuted the claim that India is
staring at 1991-type economic crisis. He said, “There has been a
deterioration in the macro-economic picture, but I don't think it has brought
us anywhere close to when we were two weeks short of running out of reserves.
We still have significant reserves and we are not dependent on external debt
anywhere near as close as we were at that point.”
does talk about dangers of the fiscal deficit and advocates about reform
measures of the government but see them a long run confidence building shot.
of the day does need much more that these narrow-focused silly reforms that hit
the Manmohan’s ‘aam aadmi’ the most.
must be a matter of national priority on what to reform and when.
not about fiscal deficit. That is a real and present danger for India, no
denying to that, but it is not as urgent as Manmohan projected. We are nowhere
near to a balance of payment crisis as was the case in 1991.
that is going to be generated out of the FDI decisions would never suffice the
mammoth requirement that India’s
fiscal deficit needs.
India’s present current
account deficit is $70 Billion and the country needs $1 Trillion of investment
to come back to high growth curve. Analysts say the retail FDI decision is
expected to generate FDI of $2.5-3 Billion per year for coming 5-6 years
provided all states implement the move. Aviation FDI is not a big bet
immediately, with potential of a few hundred million dollars only. Power
exchanges are still in infancy with small capital base so don’t read much into
the 49 per cent FDI decision here.
are not going to have a miracle anywhere on the Economy front. And the
condition is not as bad as Manmohan has projected. Yes, there are issues of
concern, but blindly cutting subsidies in a poor country like India while sleeping on the
governance mismanagement is the real culprit.
killing unequal distribution: Another worrying feature of India growth
story is the growing social disparity. It is not that country’s wealth has not
increased. It is not that the per capita income has not increased. From 1991 to
2011, size of the Indian Economy has quadrupled.
is also there that the per capita expenditure requirement is simply outdoing
the majority of the Indians and incessant price rises are adding havoc to the already
dilapidated psychological frames. The 2012 Global Food Security Index puts the world's fourth largest Economy at 66th position out of the 105 countries surveyed. India’s Human Development Index was
ranked 134 in 2011 while it was 123 in 1991. (What explains this decline?)
comfortably numb economist-turned poor economist-turned poor politician
Manmohan doesn’t want to see it or doesn’t want us to see it or doesn’t care at
all, if we, at all notice it.
‘aam aadmi’s Manmohan can throw a lavish party for his ‘khaas’ (special people)
on completing three years of the UPA-2 where every platter cost over Rs. 7000 (in
the high days of austerity that his own government had announced), reveals
an RTI reply. And this government decides that the poverty line income of India
would be at Rs. 3500 a month.
So an ‘aam
aadmi’s Manmohan allows his ministers to splurge Rs. 678 crore on foreign tours
during the year 2011-12 (in the high days of austerity), reveals an RTI reply.
policy-handicap, misplaced national priorities, ill-conceived electoral mileage
– ill-intent, shamelessness, insensitivity – Indians politics of the day sucks!
Sainath uses the term Corporate Plunder Line (CPL), but there should be another
vital term – the Political Plunder Line (PPL) – thoroughly conceived,
debated and propagated.
©/IPR: Santosh Chaubey