Economic
Highlights
New Delhi, 7 October 2019
Gandhi’s India
ECONOMIC
DISENCHANTMENT
By Shivaji Sarkar
The nation pays homage to Mahatma Gandhi, a
grass-root thinker, amid protests by farmers in Uttar Pradesh for more relief, the
core sector turning negative, increasing government borrowings, rebuilding or
destroying New Delhi’s heritage identity, opulence in lifestyle and sermons on
Gandhian simplicity.
There is more. Gandhi told the nation to
preserve ecology but in the name of creating real estate, the nation plans to
build an unnecessary airport and destroy its aquifers in western UP, mere 60 km
from Delhi international airport. Gandhi was not for destroying heritage. The
recent New Delhi destruction of heritage buildings and city may have been planned
for the real estate and construction boom. It certainly would destroy the
aesthetics and over 100 years of a planned beautiful city that rarely sees
traffic jam.
Over 90 per cent of tourists thrill to see
six-century old London or UK, which has maintained its heritage look. Can’t
India maintain its national Capital? No Gandhi can accept this destruction of a
planned heritage.
For Gandhi, the farmer was a necessity. It
was not for the kisan being the annadata
– food grower – but also the centre of rural productivity. A kisan and his family through production
of implements, handicraft, handloom, textiles and an array of goods for the
society was contributing to the happiness of the society as well adding to one
of the highest GDP of the world. India’s share was a constant about 25 per cent
of global GDP for about 200 years till the arrival of the British.
Till about 300 years ago, India accounted for
over a quarter of the world’s GDP, says “India: The Giant Awakens” report by
Aberdeen Asset Management. Aberdeen is one of the largest funds and it is
bullish about India’s growth.
That indeed was the dream of Gandhi. His
disenchantment for large monopolised industry is criticised as his opposition
to industrialisation. Gandhi had love for technology but he never wanted
technology to monopolise or ignore the man, for whose benefit it is needed.
Thus, he wanted the farmer to remain the pivot
for the economic growth, an aspect the British tried to destroy. It created
severe famines in 1770 in Bengal -- killing a third of the population, 1865 in
Orissa, 1873 in Bihar to 1943 Bengal famine -- total of 10 catastrophes. Recent
studies by IIT, Gandhinagar faculty Vimal Mishra finds that the 1943 famine was
the result of British policy despite a 10-year good rainfall between 1935 and
1945.
But rumblings of farmers in UP, Maharashtra,
Madhya Pradesh, Gujarat, Bihar and several long marches have not been able to
draw much attention. Piecemeal doles or yearly pensions may have helped them a
bit but have not focused on the inherent problems. Their biggest grudge is
selling crops at prices less than the MSP. Sugarcane farmers dues rise by 54
times in a year to Rs 15,565 crore in 2018-19 (now stated to be about Rs 25,000
crore), according to Minister of State for Consumer Affairs D R Dadarao.
Uttar Pradesh farmers’ demands include regular
waivers on loans. Gandhi would not have supported it. The kisans are ignored and their Rs 5 lakh crore budgetary support is a
loan mechanism. Post-demonetisation the cash crunch and monstrous bank rules
added to their misery. They are unable to contribute to the market sales and
this has hit GDP growth.
That is exactly the reason for more
government borrowings. Recently, the RBI was forced to give Rs 1.76 lakh crore
dole to the government, which is now mulling another Rs 2.68 lakh crore
borrowings. But it needs to rethink in terms of Gandhi. The spree of borrowing
cannot be a solution unless the savings rise. It is coming down critically for
government policies of taxing it and reducing interest rates.
The consequence is in reduction in industrial
activities. “The last two quarters have been particularly tough for the
industry because of subdued demand. There is need to reverse consumer
sentiment”, says Shanti Ekmbram, President, Consumer banking at Kotak Mahindra.
Now growth worries are escalating with the
output of core infrastructure sector contracting for the first time in more
than four years in August. Output of coal (-8.6 pc), crude oil (-5.4 pc),
natural gas (-4.9 pc) and electricity (-2.9 pc) and cement contracted. The view
now is that the pickup in IIP in July did not signal the start of a recovery.
The IIP is expected to fall to sub-1 per cent in August.
Amid this crisis, the industry wants further
subsidy by clamouring for interest rate cut by RBI. It forgets that the lower
interest rate is playing havoc with the consumers with low returns on deposits.
Gandhi always criticised such doles as it causes deprivation of the poor.
Let us not forget that the UPA incentives in
2008 to industry and rate cuts led to the severe NPA crisis of over Rs 12 lakh
crore. Much of it has not been repaid and book adjustments were done. The PMC
bank in Maharashtra or IL&FS collapsed for these reasons.
Banks continue to be in crisis and dumping
heavy unethical untruthful charges on the people. This is against the banking
Gandhi had propagated. He promoted banking because it had people-friendly rates
in his time. Today, he would have definitely deprecated unethical banking
practices.
Demonetisation, some may, believe has reduced
corruption. In reality, it has hiked it in all spheres because the perpetrators
say, “the risk has gone up”. So the taxwala
down to the chief medical officers have raised their cut money. If one needs to
open a clinic the going rate is Rs 1 lakh, which was less than Rs 50,000 a few
years back.
Gandhi may have been outdated in his
industrial outlook but not his ideology of ensuring business honesty. Today, business
wants results “whatever the means”. This is playing havoc. Small biz and
entrepreneur, for who Gandhi tolled is nowhere today. His simplicity has been
replaced by exhibition of opulence and big unreal sloganeering. The nation is
unable to afford it.
The NITI Ayog is in a quandary and can call
for round table with political parties, industry and social leaders how to
inject Gandhian honesty and ethics in biz, banking and society for ensuring an
all-round national morality and growth. That is it. The nation has to adapt
Gandhi in practice for that would be the only honest tribute to the father of
the nation and to create his dream country.---INFA
(Copyright,
India News & Feature Alliance)
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