Economic Highlights

New Delhi, 16 February 2024

Farmers Protest

GLOBAL, GOVT MUST LISTEN    

By Shivaji Sarkar 

Farmers are protesting in an election year all over the world. The day the Indian farmers were made to face severe assault on February 13 and the roads to Delhi were blocked with concrete walls, barbed wire and spikes; farmers in Brussels clogged streets, with 1300 tractors, leading to Paris pressing for fairer deals almost akin to their Indian brethren. They did not face any hostility anywhere, though agriculture according to Bloomsberg, has become a key battleground in a wider culture war over money, food and climate change. 

The list of “grievances long - soaring costs, increasing bureaucracy, new European Union regulations in its Green Deal and imports diluting their markets”. A placard says: “He who sows misery reaps anger”. What an irony! These farmers are agitating as the European Union goes to the polls. The government listens to them without accusing them of politicking. A month back German farmers blocked highways. 

Indian farmers in Punjab, Haryana and Uttar Pradesh travelling to Delhi on tractors with supplies for a long sit-in, have demands that are similar to the French farmers. Their placard says, India must quit WTO along with their demands for a guaranteed minimum support price (MSP), implying that the market must ensure fair price, food and sustainable farming. While Indian farmers are labelled with being “supported by Pakistan, Khalistanis and other anti-country forces”, the farmers in Paris are patiently heard by their government, and they put off protests. 

The contrast is sharp. The government of Haryana state blocked their roads at Punjab border, fired tear gas shells, lobbed shells from drones. In talks with Union ministers, Arjun Munda and Piyush Goyal, they have received no assurance on key issues though the government says agreement reached on ten other issues. They are alleged to be provoked by the opposition parties, AAP in Punjab and now with Rahul Gandhi’s announcement of a guaranteed MSP, if his party voted to power, also the Congress. But for the alleged intervention of Punjab government officials, situation at Ambala’ Shambhu border could have been worse. 

The farmers have a long history of indignation, particularly in France and the problems are not confined to Europe. Among the 70 countries going to polls, is the EU, India and the US. In France, the farmers complain that politicians only want to get elected, so they are latching onto the farmers movement. Most politicians and parties keep off them. Even Congress party’s Black Paper on economy only cursorily mentions them. 

The Manmohanomics of the Congress party is responsible for the beginning of corporatisation of farming, an aim of the International Monetary Fund and World Bank. Their successor government has been following the Manmohanomics and only aggravated the issues of marketing. In 2006, during the UPA government, Bihar abolished the mandis or APMs. It closed procurement. Punjab farmers rush to Bihar, buy food grains, ship it to Punjab, sell at MSP and earn profits. Bihar farmers suffer. 

During the past few years, many long marches have been held by farmers even during UPA government, as also long dharnas during the NDA, as along Delhi borders with Haryana and UP in 2022. The similarities are stark. In Europe, farmers have been holding protests in Italy, Spain, Switzerland and Romania. Polish farmers have vociferously opposed food grain arriving from neighbouring Ukraine and forced the government to negotiate. In Delhi, government blocked roads to check farmers entry to the national Capital, in Germany farmers blocked highways in January for a week against cuts in subsidies on diesel. 

Indian farmers, so far, did not even protest petrol and diesel prices that are almost double that of international crude prices. They even did not protest against auto-lobby-NGT sponsored illegal seizures of their ten-year-new cars and tractors, for which they paid EMIs for seven years. They suffered takeover of their land for building of roads for irrationally high tolls. Climate issues for grain, horticulture or fish farmers are wrecking them. 

Climate change is a big issue for European and US farmers. Though the governments there may not be that intent on the issues, they are not hostile. A US retired diplomat Hegadorn is quoted as saying, “You can live without an electric car, you can live without a mobile phone, but you’re not going to live without farmers and the food they produce”. Sensible approach in a country that has only a miniscule percentage left as farmers. Corporatisation of agriculture has neither helped the farming community in Europe nor in the US. 

In contrast, India has over 54 per cent left in agriculture or over 75 crore people. Since the last farmers agitation two years back, withdrawal of three supposedly anti-farmer laws, the government has continued with the Manmohanomics and heaped miseries on the farmers. It should not be obsessed with the factor that they are agitating during election time. World over it is so. 

The farmers are being neglected and overlooked in policy framing from the richest US and European countries to the poorest India, Pakistan and Bangladesh. In all these countries while corporate profits swell, farmers wages remain stagnant for decades. Their input costs on seed, fertilisers, machines or pesticides multiplied everywhere. 

Economic Survey of 2016 says farmers income was Rs 1700 a month. This as per National Statistical Office was Rs 10218 a year or about Rs 2000 a month as per Rajya Sabha statement in December 2022. Market-linking of agriculture or corporatisation in the prevailing circumstances has failed in the affluent countries. In the US, farmers complain they are being priced out by big companies. 

Those advising in India that it could be a success are apparently misleading policy planners. More sensitivity is required. Farmers the world over are agitating not because there are elections, they want patient hearing for solving the global crisis. 

Delhi belongs to all countrymen. The government should invite the farmers with open arms and not with spiked roads. If attended, it is easy to solve as promising guaranteed MSP would not burden the exchequer with more than Rs 2.5 lakh crore (trillion) of additional expenses, which the government agencies recover as they sell the food grains. Listening in any regime is an asset.---INFA 

(Copyright, India News & Feature Alliance)

Round The World

New Delhi, 17 February 2024

Modi In UAE

REACHING NEW HEIGHTS

By Prof. (Dr.) D.K. Giri

(Secretary General, Assn for Democratic Socialism) 

Prime Minister Narendra Modi was in the Gulf country UAE on 13-14 February. This was his eighth visit which shows the growing partnership between the two countries. He was received by the UAE President, Sheikh Mohamed bin Zayed Al Nahyan with a special ceremonial welcome at the airport. On his arrival, Modi said he was meeting his ‘brother’ (President) and felt like coming home. Modi visited UAE for the first time in 2015. His friendship with the UAE leadership has been growing ever since. He was conferred the ‘prestigious’ order of Zayed in 2019, the highest civilian award of UAE. 

Notably, Prime Minister Modi was meeting the UAE President for the third time in eight months. They had a bilateral meeting in July 2023 and again in COP 28 in November, the same year, where Modi was given the rare honour of being the only visiting dignitary to address the ceremonial opening of the session. Likewise, Sheikh Mohamed was in Delhi in September for the G-20 summit as one of India’s special invitees. He returned in January 2024 for the Gujarat Global Summit as the Chief Guest. 

The primary purpose of Modi’s visit to UAE was to inaugurate the BAPS – Bochasanwasi Akshar Purushottam Swaminarayan Sanstha - temple in Abu Dhabi. Built on the land of 27 acres with 700 crores, a 108-ft tall structure, it is the largest temple in the Middle-East. It is situated in Abu Mreikhah, near Al Rahba off the Dubai-Abu Dhabi Sheikh Zayed Highway. Inaugurating it, PM Modi said, “A golden chapter in human history has been written in UAE today. This temple will become a symbol of communal harmony and global unity for the entire world,” a shared heritage of humanity. 

Modi profusely thanked the President of UAE for making the grand temple a reality. He said, “President Sheikh Mohammad has won the hearts of not only Indians living in the Gulf nation but also of 140 crore Indians back home. He added that UAE was so far known for Burj Khalifa, Sheikh Zayed Mosque, future museum and other high-tech buildings. Now it has added another magnificent cultural monument to its identity. 

Modi was given a massive welcome called ‘Hello Modi’ (Ahlan Modi in Arabic) in Zayed City Sports Stadium. Modi said he was overwhelmed by the affection shown by the Indian community. UAE has the largest Indian Diaspora of 3.5 million people. In his speech, Modi exuded tremendous confidence as he proclaimed India will be the third largest economy of the world in his third term as the Prime Minister. Modi added that the Vice President of UAE has offered to give a land in Dubai for the construction of a hospital for Indian workers. 

Modi was the guest of honour at the 11th World Government Summit in Dubai. This summit is Dubai’s version of Davos, an annual conference of government leaders, heads of international organisations, captains of industries and thought leaders from around the world. Modi’s speech focussed on peoples’ participation, social inclusion and sustainability. He touched upon themes like empowering people and delivering change where he gave the illustration of schemes like Swaccha Bharat Abhiyan, Jan Bhagidari, Beti Bachao, Beti Padhao. On the second theme, he talked about financial inclusion for all where he referred to banking facility for 500 million people in India which makes the country the world leader in fintech and digital payments. 

The third theme was about India’s start-up surge. It has become the third largest start-up eco system in the world. With all such projects, 200 million people have been lifted out of poverty and 130 crore people have digital identity. Fourth, Modi talked about India leading on the climate change actions. Projects like mission life and green credit system have facilitated India’s investment in solar, wind, biofuel, green hydrogen and so on for a sustainable future. 

Finally, Prime Minister summed up his speech by emphasising on pro-people approach in governance that also protects the environment. He said, “The world must embrace a smart, technology driven, transparent and environmentally sustainable governance.” 

On the economic front, eight agreements were signed with UAE on investment, electricity, trade, digital payments, connectivity etc. Remember, a Free Trade Agreement was signed in 2022, which among other things, eliminated the duties of 99 per cent of the UAE’s imports from India. These pacts will take the bilateralism into greater heights. A bilateral Investment Treaty was signed which will have long-lasting impact as a follow-up of FTA. A MoU on electrical inter-connection and trade was signed which would open up new areas of collaboration in energy including energy security. 

Another agreement on linking the instant payment platforms, India’s Unified Payment Interface (UPI) and UAE’s AANI was signed. Along with it, India’s domestic debit and credit cards, RuPay was linked with UAE’s Jaywan which would enhance RuPay’s acceptance in the UAE. A MoU was signed on digital infrastructure projects – sharing of technical knowledge and expertise and investment on digital infrastructure. Two more agreements fostering cooperation between national achieves of two countries were signed. They are meant to help restoration and preservation of archival material in the fields of heritage and museums. 

Prime Minister discussed with the President the upcoming major project, India-Middle East-Europe Economic Corridor (IMEC) which is a counterweight to ambitious BRI – Belt and Road Initiative of China. The IMEC will build on earlier understanding of the participating countries and foster cooperation for regional connectivity. Prime Minister invited UAE to actively participate in this project. 

Modi inaugurated the Bharat Mart, a joint venture of Dubai-based DP World and India’s Ministry of Commerce and Industry. Bharat Mart is meant to boost export of India’s micro, small and medium enterprises with retail, warehousing and logistic facilities. It is located in Dubai’s Jebel Free Zone area built on a plot of 1.3 million sq ft containing 8000 showrooms and 18 warehouses. 

Prime Minister Modi said that India and UAE are partners in progress which could serve as a model for the rest of the world. Partnership is reaching new heights scripting a new history in the third decade of the 21^st century. Metaphorically, the scripting of a better future for both countries was written on Duniya ki Kitab (Book of the World) by Waqt ki Kalam (The Pen of Time). The partnership consists of talent, innovation and culture.  It seems the partnership between India and UAE is experiencing a ratchet growth which is good for both the countries and the region. ---INFA 

(Copyright, India News & Feature Alliance)

REWIND

New Delhi, 15 February 2024

POLL BODY, PRESSURES & INDEPENDENCE

By Inder Jit

(Released on 10 February 1990) 

India has once again proved its claim to being the world’s biggest democracy. Nearly 300 million people exercised their franchise recently and brought about a smooth change of Government. The country is again poised to hold elections in eight States and one Union Territory --- this time to the Assemblies. Outwardly, the electoral system has worked well. Inwardly, however, it is sick and leaves much to be desired. Happily, the Prime Minister, Mr V.P. Singh, convened on January 9 an all-party meeting for consultation on electoral reforms. Subsequently, a 12-member Committee came to be constituted to go into all aspects of electoral reforms and submit its report to the Government expeditiously for required legislative and other action. Most of the maladies of our electoral system are well known so also the available remedies. But of crucial importance to free and fair elections and to the future of our democracy is the need to ensure the Election Commission’s vital independence which, most sadly, has come to face mounting threat from India’s rulers during the past seven years and more. 

Not many are aware that the former Government, headed by Mr. Rajiv Gandhi, wanted the Chief Election Commissioner, Mr R.V.S. Peri Sastri, time and again to so hold various elections and by-elections as would load the dice in favour of the Congress-I. The powers that be, for instance, wanted the Presidential poll to precede the election to the Haryana Assembly in 1987. But Mr Peri Sastri refused to compromise with the letter and spirit of the Constitution. The Haryana poll, which swept Mr Devi Lal and his Lok Dal to power, was held on June 17 and the Presidential poll on July 13. On June 16, 1988, the ruling Congress-I demanded a repoll in the Lok Sabha by- election from Faridabad following widespread violence and booth capturing. The CEC again declined to oblige. Instead, he ordered a repoll in 161 polling stations. Matters again worsened over the revision of the electoral rolls in Assam. The CEC was even accused of siding with the AGP in his interpretation of the Assam Accord. But he refused to be bullied by the Government. 

Various pressures were thereafter mounted on Mr Peri Sastri to force him to resign. But these too failed. A new strategy was then forged for a “take over” of the Election Commission. On October 9 last, a Presidential notification was issued out of the blue clearing the way for a three-member Election Commission. A week later, Mr. S.S. Dhanoa, a retired IAS official, and Mr V.S. Seigell, a retired IB official, were sworn in as the Commissioners. All the formalities were completed in record time, notwithstanding the Government’s earlier opposition to the proposal. On December 16, 1988, Mr Gandhi himself turned down in the Rajya Sabha a demand for a multi-member Election Commission and stated: “This demand means that some Opposition members have no faith in the single-member Commission”. Again, the appointment of the two Commissioners was justified on the ground of an increase in the work-load following reduction in the voting age to 18 years. Yet, the additional workload had already been handled by Mr Peri Sastri and the rolls revised earlier --- by the end of August. 

Some of Mr. Gandhi’s aides expected Mr. Peri Sastri to quit in disgust. Not one of the names suggested by him for additional appointment as Commissioners was accepted by the Government. (One name suggested was that of the senior-most among the Chief Electoral Officers in the State.) Worse, Mr Peri Sastri was reduced to a minority in the Commission. However, he kept his cool and decided to face the new challenge. This came barely a day later. Early on October 17, the Government decided on its own to hold the General Election on November 22 and even made its decision public. This was wholly improper as the decision is the prerogative of the Election Commission. Expectedly, Mr. Peri Sastri was livid and refused to ditto the formal announcement. However, he decided to overlook the impropriety in the larger interest of democracy and a timely poll. (Remember, there was repeated talk then about the possibility of the Rajiv Government somehow postponing the poll by a year or more but the CEC eventually made the announcement only after he was able to sound the Opposition leaders and secure their acceptance of the dates.) 

The fat was again in the fire before the day was out. The Government, I learn, wanted the Election Commission to announce its programme for the general election on October 17 itself and simultaneously make the required recommendation to the President for issuance of the formal notification for the general election. This was intended to give the Opposition leaders even less time to put their act together and ensure a one-to-one fight against the Congress-I. This was viewed by the CEC as grossly unfair and improper. He, therefore, declined, leading to a fresh crisis. (Even the Prime Minister’s Principal Secretary was constrained to call on Mr Peri Sastri during the course of the drama-packed day.) In fact, things came to such a pass that some of Mr. Gandhi's top advisers explored at one stage the possibility of summoning Parliament to oust Mr Peri Sastri. (The CEC can be removed only in like manner as a Supreme Court Judge.) Fortunately, good sense prevailed at the highest level. Mr Peri Sastri was allowed to have his way. The President was able to issue the poll notification only on October 22. 

Not just that. Information available to me before I left for Darjeeling on October 28 to contest the Lok Sabha poll shows that the decision to go in for a three-member Election Commission was mainly calculated to put maximum spokes in the Janata Dal’s wheel. The Janata Dal, it may be recalled, had claimed the poll symbol of the erstwhile Janata Party, namely, a farmer with a haldar, following its birth through the merger of the Janata Party and the Lok Dal. But this claim was disputed by Dr Subramanian Swamy on behalf of the Janata Party and by Mr. R.N. Kushwaha on behalf of the Lok Dal. Both Mr Dhanoa and Mr Seigell wanted the Janata Dal denied recognition as a national party and allotment of any reserve symbo1, pending a final decision on the dispute. But Mr Peri Shatri was able to ensure fair play prior to the poll by handling the matter deftly. The Janata Dal as well as the Janata Party and the Lok Dal were allotted reserve symbols in an interim order with the consent of all the three parties. The Janata Dal would surely not have bagged as many seats had it been forced to fight the po1l on free (and confusing) symbols from constituency to constituency! 

One question arises. What can be done to ensure the independence of the Election Commission? Or, as the respected Dr H.N. Kuzru put it to Dr Ambedkar in the Constituent Assembly: Can something be done to “provide such safeguards as will give general satisfaction that our electoral machinery will be free not only from provincial political influences but also from the central political influences.” The Jayaprakash Narayan Committee on Electoral Reforms as also the earlier Joint Parliamentary Committee on Amendments to Election Law favoured a multi-member Election Commission. The idea is no doubt sound in theory. But, as Mr. S.L. Shakdhar, formerly Chief Election Commissioner, told me in his time: “The proposal is not practicable. I could not have ordered a repoll in Garhwal promptly and thereby prevented the place from going up in smoke if I was not a one-man Commission.” Mr Peri Sastri’s view is no different. In fact, the recent three-member Commission proved to be a near disaster, hamstringing speedy action time and again. 

How does one ensure that the one-man Commission will be fair and impartial? We have had among our CECs Dr. S.L. Shakdher and Mr. Peri Sastri on the one hand and Mr R.K. Trivedi on the other. (Remember, Mr. Trivedi was rewarded with a Governorship for his good work!) Various suggestions have been made over the years. The BJP President, Mr L.K. Advani, would like the Chief Election Commissioner barred from being appointed to any office of profit after retirement. Some want the CEC to be appointed by the Chief Justice of India and to senior Chief Justices of the State High Courts. Others want the CEC to be chosen by the President, the Vice President and the Speaker of the Lok Sabha--- or by the Government in consultation with the Opposition. However, we need to remember one basic truth: a process of consultation does not guarantee anything, specially in our feudal environment. A formal ban on the CEC from holding any office on retirement is highly desirable and should help. Ultimately, we must think in terms of an arrangement which would enable him to get what he needs most: moral authority. 

Fortunately, the Election Commission has reportedly came forward with a suggestion, described as “the ideal arrangement”. The Chief Election Commissioner, it is proposed, should come to be chosen on the basis of his professional expertise, experience and seniority like the Chief Justice of India in accordance with established convention. Such an arrangement, we are told, could be evolved by establishing another all-India cadre: the Indian Election Service. The Chief Election Commissioner could then be chosen from the service itself --- from among persons designated Chief Electoral Officers and accorded the same status as the Chief Secretary in a state. Even today we have Chief Electoral Officers in the States. They are, however, a part of the administration and open to political pressures both from the State Governments and the Centre. An Indian Election Service, which would essentially be skeleton in character, could provide the answer. The Commission’s proposal merits serious consideration. – INFA 

(Copyright, India News & Feature Alliance)

Open Forum

New Delhi, 14 February 2024

White & Black Papers

POT CALLING KETTLE BLACK?

By Dhurjati Mukherjee 

The White and Black Papers released recently by the ruling party and the Congress respectively have tried to find fault with the other. Though such analysis may be useful in understanding the way each government has functioned, one of these studies has shown how they plan to tackle future economic problems. These papers come close on the heels of three important southern States, led by Karnataka, protesting denial of adequate funds only because of their better performance in various sectors compared to northern States. 

The 59-page NDA Paper accused the UPA rule of bringing public finances to a ‘perilous state’ with high levels of fiscal deficit, which a panel headed by noted economist Vijay Kelkar had pointed out. As a result of fiscal mismanagement, the deficit ended up much higher than it was expected, and subsequently ended up borrowing 27% more from the market than what it had budgeted for in 2011-12. 

Regarding the banking crisis, the report said that in September 2013, the ratio of gross NPAs to advances, including restructured loans, climbed to 12.3% largely because of political interference on commercial lending decisions. These observations have been rightly pointed out, specially the improvement of the health of the banks during the NDA regime, though it can’t be denied that interference in bank management continued. This is corroborated in the case of Mehul Choksi and lately Gautam Adani, both of whom are said to be close to the Prime Minister.   

The paper highlighted Modi government’s successes, saying it cleared loans of over Rs 1.9 lakh crore taken during the UPA regime to fund food, fertilizer and oil subsidies with over Rs 1 lakh crore to be paid in the coming years as principal and interest. It pointed to revival of the Indian economy from a state of crisis. “When the NDA government took over the reins in 2014, the economy was in bad shape, nay, crisis. We faced the hydra-headed challenge of fixing an economy mismanaged for a decade, and restoring its fundamentals to sound health,” stated the white paper. Besides, it highlighted how the economy emerged stronger in the past decade under the BJP-led NDA government and is today counted amongst the top five economies of the world. 

The Paper referred to the mismanagement of the economy during the UPA regime and apart from the various scams, it found that over Rs 94,000 crore or 6.4% of the budgeted expenditure for 14 major schemes and rural sector ministries remained unspent over 10 years. Besides, it showed that funds not deployed properly as capital expenditure fell from 31% during 2003-04 to 16% in 2013-14, resulting in a “supply constrained economy”. Additionally, a large part of resources was used for unproductive purposes, involving an estimated outgo of Rs 26,000 crore in 2008-09 and Rs 52,000 crore farm loan waivers as cases in point. 

The overall improvement of the economy has been well highlighted but what has not been said is whether this uptrend has benefitted the poor, the marginalised and the economically weaker sections. Various experts and studies have pointed out that the main beneficiaries of the government’s policies have been the rich and one segment of the middle class or perhaps the entire middle class.  As per the World Bank’s Commission on Global Poverty using the leaked data of the NSS revealed that 320 million rural Indians lived in acute poverty in 2017-18, 50 million over six years earlier. 

It would be appropriate to mention the Oxfam report, released last month, which revealed that the wealthiest 1% of the population possess 40% of the nation’s wealth, while the remaining 50% hold just 3%. Furthermore, the number of billionaires in India has seen a notable rise. The UNDP report indicated that the top 10% of the population commanded 65% of the country’s wealth. Over the past decade the real wages of 35% of the population have experienced a decline. Real wages denote the purchasing power of wages concerning goods and services. India was ranked 139^th on the Global hunger Index. In per capita incomes, India is at the bottom of all the G-20 countries. Parliamentarians questioned whether the real Amrit Kaal would start only when all people get equal healthcare, education and opportunities to grow? 

Thus, the overall scenario is quite grim though India may be the fifth largest economy. This has been revealed in Congress’ Black Paper, which pointed out that “the Modi government’s 10 years in power devastated the country’s economy, aggravated unemployment, destroyed the country’s agricultural sector, abetted crimes against women and committed grave injustices against minorities in the country”. The 54-page Paper said the highest rate of unemployment in 45 years, going from 1 crore in 2012 and 4 crore in 2022, 10 lakh sanctioned central government post still unfilled, despite high unemployment, 33% unemployed amongst graduates and post-graduates and 2 employed persons dying by suicide every year. On inflation, the Congress stated that there has been a steep increase in the prices of essential commodities from 2014 to 2024 – 120% in increase in the cost of LPG, 37% for petrol and 64% for diesel, 59% for mustard oil and 59% for wheat flour and 71% for milk. 

The above findings can’t be denied as social and economic development was mainly geared towards the urban sector and the privileged sections got the maximum benefit. Also, the middle-income sections got their due share but the marginalised and backward sections didn’t notice any perceptible change in their incomes and standard of living. However, in recent years, the Modi government has turned its attention to the rural sector, but real backward areas have yet to be brought into mainstream development. 

It was expected that the paper of the ruling dispensation while criticising the previous UPA regime would have outlined future priorities, specially with regard to the farming community, small traders, those working in unorganized sector, all of whom are a major segment of the population. Though governance may have improved during the Modi government, there is an absolute need for ensuring that welfare measures reach these sections and development is geared in the right direction. 

It goes without saying that more resources are needed for which the wealthy must be imposed a wealth tax, but the government is hesitant. The logic that such tax will not boost investment can’t be accepted as private sector investment in recent years has been quite low despite various government incentives.    

Finally, the development matrix must change, and the present government should be realistic and judicious in allotment of funds to sectors that need them and those that cater to the welfare of the major section of the population. Development must come from below and its spread effect must be uniform, reaching all corners of the country.  ---INFA 

(Copyright, India News & Feature Alliance)