VIEWPOINT
AMITABH SHUKLA
Politics and Economics are
intrinsically linked in our country and one affects the other. That perhaps
explains why Indian economy is going downhill like a vehicle whose brakes have
failed. The driver of such a vehicle has no control on the machine even if he
tries. Something similar is happening to the economy and the driver
(Government) has lost all control on it and it is a free fall.
National Food Security Bill was
passed by the Lok Sabha and the poor of the country who are a staggering two
thirds of the population would get coarse crops, wheat and rice for Rs 1, Rs 2
and Rs 3 per kg. I do not have any objection to such populist schemes provided
you have resources and the economy is robust with all indicators in the
positive. But the point is has the Government got enough resources to fund the
scheme or has it ever thought of the implications such schemes entail in the
long term. For me, the case of the Government is like that of a poor person who
does not know from where his next meal would come but has offered someone else
a wholesome meal.
Then has anyone thought that when
one can get a meal practically for free under the Food Security Bill, will
there be any incentive left to work and contribute to national growth. You
already have NREGA or assured income per year where no productive work is done,
except digging ponds and filling them up but wages are paid from the tax
payer”s money. Now, you have food security and all incentive to work for your bread
and rice is gone. You need not do anything, simply sit at home most of the
time, get NREGA wages for 100 days or 150 days in a year depending on the State
you live in and go to the nearby PDS or earmarked shop to purchase coarse crop,
wheat or rice for Rs 1, Rs 2 and Rs 3 per kg. Will the nation benefit from such
a scheme in the long run when two thirds of the population would live in the
earnings of the one third perpetually?
I can understand the logic and
argument of both the ruling party and the Opposition if such schemes are meant
only for physically challenged people, those suffering from some ailment or
those above 60 years of age. The State should have a mechanism in place for
them. But that is not the case here. To
me, a blanket Act without any checks and balances is perhaps the greatest flaw
of this legislation. Almost 80 crore people will get benefits with the proposed
law though its efficacy will be known only months after it is fully
implemented.
With such schemes, you only
ensure that no one has any incentive left for work. The able bodied people, who
can work for the growth of the country and for strengthening its economy, have
the lucrative option of not doing anything except while away their time. Under
several Government schemes, poor get free houses; they get assured employment
under NREGA without working, free treatment and medicines in government
hospitals and now free food. What would be next? Twenty meters of clothes each
year for all those who qualify under the Right to Food Act!
NREGA perhaps explains the acute
shortage of labour all over the country in small manufacturing units and
organised agriculture. Even if the workers are paid Rs 10,000 a month, they prefer not to
work in a far away city as without working and staying at home, the Government
largesse would help their primary concern of roti and rice.
Recently, I went to Bihar
and found that the State which once had surplus labour and where one could
easily find workers for agricultural fields now has an acute shortage. It is
not that the population of the State is declining, but Government schemes, both
of the Centre and the State, have ensured that sitting in the thatched hut and
doing nothing, is more in vogue than looking for a job, working in the fields
and raising the standards of the family.
When in Bihar ,
I found that the Nitish Kumar Government even has a scheme which offers radio
sets free of cost to a section of the people, depending on their caste. This
scheme defied all logic except the fact that when you need not work and get
food, keep listening to songs on radio to pass your time. I would not be
surprised if the scheme is upgraded by the Bihar Government and the BPL
families get a colour TV set with a satellite connection and also a battery to
watch TV as there is hardly any electricity in rural Bihar .
Simple economics tells you that
first you have to generate income and only then it can be distributed. By all
means give to the have-nots but for that first you have to generate resources
and income. If you don”t have income, how can you give? Country”s first quarter
Gross Domestic Product (GDP) data released on Friday by the government reported
a fall in economic growth for the April-June quarter of the current year at 4.4
per cent as against 5.4 per cent in the same quarter in the previous fiscal.
There is not a single sector which is buoyant. Manufacturing and mining sectors
are staring at negative growth for the last several months. There is recession
in all industries. Employment figures are falling. The Rupee is sinking, there
is inflation all around, prices of petroleum products are increasing almost
every fortnight, investments are not coming and the Prime Minister has thrown
his hands in despair. For, how long can you milk the service classes and the
industries with a host of taxes? Rob Peter to pay Paul! Or in an Indian context
rob Anil to pay Sunil!
There is a parallel to what is
happening today to the late 1980s when the Soviet Union
collapsed. The collapse of the once mighty Soviet Union
was more due to economics of a communist regime where everything from food to
Vodka was supposed to be free of cost and you got a subsistence allowance even
when you did not work. Soviet
Union was offering schemes similar to Food Security and NREGA
though the names were obviously different. You could get your bread and butter
there without working and this cannot be sustained forever. I am not saying the
situation in the country is that bad but history teaches us lessons and we
should be eager students to learn from the mistakes which others did. Do not
try to import the communist economic model which failed miserably in Soviet
Union and several other countries.
Now, you have another so called
“game changer”- the Land Acquisition Bill. I don”t know how many industries
would come forward to set up shop in the country when they won”t be able to
even purchase land from the farmers. Even if they try, the lands would be so
expensive that they will prefer to shift to China ,
Bangladesh or
some other country in Africa and Latin
America where they do not have the Land Acquisition Act and can
easily get the requisite land they need to set up manufacturing units.
In a democracy, obviously getting
in power is crucial and whoever is in politics would like his or her place
under the sun. Right to Food and the Land acquisition legislations clearly are
aimed at this. But here, there is a mismatch between the political aspirations
of the ruling Congress-led UPA and the ground realities. Political aspirations
are overriding economic realities of the country and there lies the danger. (September 2, 2013)
