Economic Highlights
New Delhi, 8 April 2019
Cong
Manifesto
BACK
TO INDIRA’S SOCIALISM
By
Shivaji Sarkar
The General election is
leading to fresh thinking and a new economy. The road to it looks competitive
for placating the voters with direct sops. The Congress has opened up Indira
Gandhi’s socialist wonder box. Others may be trying to outmaneuver it.
The issue is not who
delivers and who makes it possible. The campaign is attempted to be pitched
between Rs 6,000 a year to the farmer that the BJP promised in the Central
budget and Rs 6,000 a year to the poor by the Congress – garibi par var, bahattar hazaar – war on poverty, Rs 72000 – to 20
per cent poorest households.
Everything can be delivered.
The poor need it too. It costs a mere Rs 3.6 lakh crore according to the Congress
but some experts say it is Rs 18 lakh crore – more than the revenue earned.
Even that may be possible!
But its answer can be found
in Odisha’s KAALIA scheme for farmers and labourers. Today the State is facing
severe labour shortage as locals do not go to work, complacent with the dole. Odisha
is importing labour from West Bengal and Jharkhand which has pushed it into debt.
Competitive mindless poverty
removal is costing the nation in many other ways. The MNREGA also has made people
lazy and many get work for cuts despite bank transfer of the “wages”. Its
positive is reversal of migration of labour. But at the same time it has led to
labour shortage in rural areas. The Congress manifesto says the gram sabhas and
urban local bodies are to “employ” youth for regenerating water bodies, but
then again the funds would obviously go from the Centre.
The economists who have
worked out such freebies are motivated by the concept of distributing wealth.
That’s laudable. But a country where economy is slowing down as the ADB has
pointed out in its latest report, how would such programmes sustain it
particularly as banks are in a tizzy.
The manifesto does not speak
for the bank health or the roadmap for creating jobs though asserts it would give
jobs. Miracle may happen or not, the new slogan ties to match Modi hai to mumkin hai (if Modi is there
it is possible). His bag is yet to be opened.
It has gone back to 1950s in
announcing that it would create Ministry of Employment and one crore jobs in
villages. The Nehru government had set up employment exchanges (EE) under the Central
government in the first Plan and before the second Plan transferred it to State
governments. The EE remained non-functional!
It is nice to promise 33 per
cent jobs to women, but in a scenario where the economy is in a tizzy, doing
that is not easy. The route suggested is to employ 22 lakh persons in
government jobs. If it can be done, it may change a narrative and it should
also be seen as a failure of Manmohanomics, which had promoted privatisation.
The Congress is smart. It
has pushed the NDA government to follow its economic policies and forced it to
face jobless low-growth syndrome. The private industries except some large ones
are gasping.
The new back to government
policy, if it can enchant the young voters, can change the electoral dynamics.
Will the BJP also attempt a similar move? That means the Left may be
diminishing in political scenario, their socialist ideals followed by Indira
Gandhi are back. It also means the major political parties are in a quandary.
Is India unsure of the path?
Indeed welfare has become a
major plank – be it Rashtriya suraksha bima, Ayushman bharat or now the
Congress doubling of government spending on healthcare rather than insurance.
So will the government be able to do that? Theoretically, it is fine but again
how to work out the logistics.
The manifesto has brought
education at centre stage through investment of 6 per cent of GDP and free
education up to class 12. The roadmap to higher education that is crumbling due
to lack of social funding is unclear. The Congress and the BJP are at an even
plain.
But some of the sensible
decisions are in replacing electoral bonds with national election fund, restoring
Planning Commission, withdraw citizenship bill, scrap Angel tax, fee for
government examinations and posts, law on sedition and ending AFSPA that gives
draconian powers to the uniformed forces.
Simply put, it is keen on
deviating from the debate on nationalism--rashtravad. The sedition law – Sec
124A- is a colonial law and should have been scrapped long back and whether
AFSPA has helped or harmed nobody is sure. The bonds are stated to be opaque.
Whether it’s so or not, how the new poll fund would be different has also to be
explained.
The restriction of Aadhar to
welfare schemes may help many people whose bank accounts have been swindled. It
may end the confusion that prevails in banking and many other sectors. Plus, it
is not clear how restoration of special category status to North East would
make a difference except for political rhetoric.
There is a great disappoint.
The Congress manifesto does not speak a word about high income-tax, atrocious
levels of highway and other tolls and bank charges. If Congress and BJP have the
same policy, it would be a wonder that the voter would choose the Congress.
The Grand old party has
promised a one-rate GST including on fuels. That is a way to lure the business
class which stood by the BJP even after demonetisation. But there are hints
that since all these promises, if the party wants to implement in sincerity,
may be a disaster for the economy and the common man’s pocket. The revenue
kitty is small. New taxes and levies would inevitable to bridge the gap.
Congress experts are hinting
at that too. So the Left-leaning budget has to gain capital and the obvious way
is to burden the people with more levies. Despite some disillusionment with the
BJP, this can benefit the Congress rival, which has cut income tax and
post-poll is likely to redo the tax arithmetic for higher slabs.
The biggest question is
whether this would make difference to the Congress fortune. But the latest ED
charges on the Agusta middleman may also have repercussion on the party. Would
the gains of the manifesto be shadowed by Agusta? Graft remains an issue for
the past few years. It may not be an easy job for the Congress but it would
like to come out of it charging that these are political manipulations by the
government.
The voter would presumably have
the last laugh. That apart the manifesto does not unfold the map for
rejuvenating the economy. Sops may charm voters but if economy does not move up
it can end up in disillusionment.---INFA
(Copyright, India News & Feature Alliance)
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