The economic situation of the country is deteriorating fast with each passing day. To make matters worse, it seems that the centre has run out of even bland ideas of reassurance for overcoming the ever worsening economic woes. The Current Account Deficit is spiraling out of control, in addition, the woe of the weakening Rupee against the dollar. The weakening of the Rupee has ended up making the imports on petroleum product more expensive than ever, which will end up making a further dent in the economy. About a year ago, when the Finance Ministry was once again handed back to Chidambaram, everyone had hoped that the economy would be back on track despite all the challenges, however, the situation has taken a turn for the worse. So, is it that the government has given up and accepted the situation as a fait accompli? If the government wishes, there are so many ways and means with which it could bring the economy back to normalcy, however, it seems it has an altogether different agenda. So many economic reform measures are gathering dust as the government has been unable to expedite them. The GST bill is one of these, which has been lying in cold storage because of the opposition of the state governments. It now seems that any decision on this will be taken only after the formation of the next government.
The cabinet has been saddled with the proposed Food Security Bill for the past few days. The way the Food Security Bill has sprung into priority for the government, and the government has harped on that a special session of the Parliament ought to be called to enact a law on the proposed bill, the way it seems the government could even promulgate an ordinance in an effort to bulldoze the Food Security Bill, all this smacks of some sort of an ulterior motive. There is no denying the fact that food security is a must, but why is it that the think tank of the Central Government seems completely oblivious to the deteriorating economic situation of the country. It would have been welcome if the government had called a special session of the Parliament to discuss the deteriorating economic situation. But, when the government turns a blind eye to so many other problems as well as the economic problems of the country, but only channelizing all its resources and energy on the food security bill, then one can very well see through the sinister game of the government. In the garb of one more social security measure, it is only trying to garner more votes. In any case, this government, since its last term has been promoting only such social security measures to play vote-bank politics. Even MNREGA, the employment guarantee programme of the Central Government seems to have been brought in only to generate votes. MNREGA and food security bill are important ones and can actually go a long way in helping the intended beneficiaries, but someone seriously needs to ponder over the kind of damage that it will cause to the economy. The burden that these programmes are putting on the Indian economy has left it high and dry. The capital that was meant for investment in infrastructure is being used by the government to fund its populist social programmes.
One of the unwanted effects of MNREGA is that the easy money is leading to indolence among the workers. Despite the billions having been spent on MNREGA, the state governments are hard pressed to prove that the nation is really moving on the path of progress. Won’t it be apt on the part of both the Central Government and the state governments that they tell us what kind of positive results have been brought in terms of infrastructure in the last five years because of MNREGA? The infrastructure sector of the country is in shambles. No concrete progress has been made in the construction of roads, rather the power sector too has shown sluggish growth. Galloping interest rates along constantly falling demand has led to a dampening situation in the investment market. The dichotomy in the policy is such that where power plants have come up and are ready to produce, there is no coal available to feed them, at other places, if the plant is actually producing electricity, then there are no buyers, it is all because the southern grid has not yet been connected to the national grid and probably this will not happen by the end of this year.
The kind of enthusiasm that the UPA has shown for the food security bill, it seems, it just wants to gain maximum mileage out of the populist measure. The food security scheme will cost the exchequer a whopping Rs One Lakh crore per annum and this will leave the over-burdened economy in dire straits. The Public Distribution System which is synonymous with corruption in the country will be used to implement the food security programme, this is meant to swindle the nation’s money by unscrupulous elements. It is strange how the policy makers of the Central Government are going to town blowing their own trumpets. The truth is that these programmes are already in place in some states of the country, but trying to push through a behemoth of a policy which will only further bleed the already derailed economy without sufficient debate. With the food security bill, the Congress is trying to prove that no party is more concerned about the poor than them, but if this bill becomes a law and gets implemented in its half-baked form, then it will go futile like the ‘right to education law’ which was executed three years ago. It is no secret that in the absence of adequate infrastructure, the right to education law has only remained on papers and it has made no effort in raising the education levels of the underprivileged.
It is difficult to reaffirm on observations made on present situation that the Congress and its ruling government would be able to overcome economic crisis prevailing in the nation. The rudderless Central Government is only biding its time, and it is not only politically weak but also suffers from a lack of will-power to bring about any major change. It would be wise had the government concentrated on improving the situation of the country instead of worrying about the forthcoming elections. Any new government will find it very difficult to bring the country out of the present morass. If the government thinks that it can defer all the major decisions till the elections, it is wrong on their part. Elections or no elections, when it comes to taking major decisions with regard to national interest and economic challenges, no government should be found wanting in taking quick and timely decisions.
(An original copy of the article published in Hindi on June 9, 2013 translated by the English editorial. The author is the Group Editor of Dainik Jagran)