Communist Party of India (CPI) parliamentary group leader
and CPI
National Council secretary Gurudas Das Gupta has said that the UPA-II
government has miserably failed over the years to stimulate inclusive
growth and rather did not succeed even to maintain the rate of GDP
growth attained earlier, which is today at an all-time low of 5.3 per
cent. It could not even hold the price line mainly of the essential
commodities including food articles.
The veteran parliamentarian, also the AITUC general secretary, made
these observations in his dissent note on the report of the
parliamentary standing committee on finance concerning the present
economic situation, submitted on August 29, 2012.
Unfortunately, the standing committee’s draft report as prepared
failed to critically examie the fundamentals of the economic policy
and suggest effective alternatives instead objectively approved the
policy that has been pursued by the government, he said. “It does not
even refer to the futility of the policies and non-performance of the
government. In my view, the committee did not discharge its
responsibility by patting on the back of the government.”
Saying that the present crisis cannot be attributed solely to the
international crisis, second in two years, Dasgupta said that the
present policy of unguarded liberalisation, reckless privatisation,
unusual dependence on foreign funds, over dependence on export market,
failure to curb speculation in a situation of scarcity, its total
inability to provide economic empowerment to a vast section of the
majority of the people, galloping disparity of income and increasing
unprecedented concentration of wealth in the hands of the few form the
basic negative feature that has been overlooked by the committee.
The report speaks of “economic incentive regime for accelerating and
sustaining growth.” It also states that “the committee, hence
recommend that the FDI policy may be reviewed by the government to
ensure the above and make India an increasingly attractive and
investor-friendly destination for foreign investors.” It further says:
“Our policies should attract more long-term capital inflows and push
investments through reforms.”
Thus, the CPI group leader pointed out that the observations clearly
approve the government of India’s FDI-friendly policy of economic
reform, spelling out the undeniable message that it is the foreign
investment that will engineer the process of accelerated economic
growth obviously taking care of the basic human problems. “This
proposition has not been found to be correct anywhere in the world.
The committee rejecting all the Indian realities, by implication seeks
to strengthen the hands of the government to bulldoze its
people-unfriendly economic reform. The report will give a free hand
to the government to allow FDI in the retail trade, further tax
concession to the corporates in the SEZs, it will lead to more
violation of labour laws and enable the government to infuse FDI in
the banking and insurance having proportionate voting rights. In the
name of attracting foreign funds it will bestow more concessions
undermining the national interest, making India the most attractive
hunting ground for the international players looking for unlimited
profits exploiting national resources and manpower.”
Stating that primarily the growth of the economy depends
on national resources augmenting progressive tax revenue, broadening
the tax base, reducing the tax concession, holding up tax avoidance,
by waging all out war to retrieve black money, curbing unaccounted
income, effectively fighting corruption and reducing wasteful
expenditure and relocating priorities in the process of budget making,
he said that nobody is denying the role of FDI in national
development, which by all means is subsidiary.
The direction of the report, which is extremely flawed
is stereotyped and does not search for alternative policy which the
nation is looking for. There is no word for stimulating the domestic
market, enlarging the empowerment of the marginalised majority.
The report in the background of the agricultural crisis
does not call for heavy public investment in agriculture, only asks
for ‘infusion of funds’ without indentifying the source of funds.
While investment in agriculture has been dwindling down over years,
both public and private, the report does not “look beyond the nose,
makes a superfluous comment on the need of infusion of funds, which is
unlikely to happen.”
“Nevertheless it is correct to say that private investment has a
crucial role in a mixed economy like India. But in a situation of
gloom and downturn, it is massive government investment targeted to
augment the income of the common people, for creating job, ensuring
stability of income of the disadvantaged, even incurring budget
deficit can turn around the economy. Heavy government investment will
stimulate the market, generate the income, improve aggregate demand
and as a result market shall look up creating the atmosphere for the
inflow of profit oriented private investment, even draw foreign funds.
Unfortunately, the alternative perception is ignored and discarded by
the Report and in fact it strengthens the hands of the government to
carry forward the present anti-people economic policies”, the dissent
note adds.
Criticising the government for recommending the sale of family silver
to meet the grocer’s bill, he said that the report suggests
disinvestment for raising revenue, when the market sentiment is so
negative. “The Committee unfortunately goes so far as to suggest 10
per cent reduction in the non-plan expenditure which essentially
suggests to reduce subsidy obviously hurting the common people. This
is quite in line with what the present government wants to do. In the
name of quoting RBI, the report puts on record with concern the
question of overshooting of subsidies.”
The committee, he says, “even refers to with concern the impact of
‘retrospective tax laws’ and ‘general anti-tax avoidance rules’. It
calls upon the Government to modify/withdrawal these laws so that
investors’ interest is not hurt. It calls upon the government for the
speedy enactment of the financial reform Bill including Pension Fund
Regulatory and Development Authority Bill, the Companies Law Amendment
Bill. The report undoubtedly shall be a feather in the cap of Dr
Manmohan Singh’s government.”
The report in the name of strengthening the health of the banks “seeks
to permit the government for going for merger of the banks undermining
the national interest. It also opens the door for private investment
in banks diluting its public sector character.”
Since the report is one sided, seeks to strengthen the
hand of the government in pushing through all its corporate friendly
reform programme at the cost of the interest of the people, since the
report does not locate the fundamental anachronism in the economic
policy that has led to a situation of slowdown and food inflation,
almost taking the country to the threshold stagflation, since the
report is in fact an apology for the inaction of the government and
since the report does not find any fundamental flaw in the policy and
refrains from outlining people friendly suggestions Dasgupta made it
clear that he has no other alternative but to put on record his
dissent. “It is unfortunate that the report is likely to serve as a
readymade weapon in the hand of the government to defend its failed
economic policy running the country.”
National Council secretary Gurudas Das Gupta has said that the UPA-II
government has miserably failed over the years to stimulate inclusive
growth and rather did not succeed even to maintain the rate of GDP
growth attained earlier, which is today at an all-time low of 5.3 per
cent. It could not even hold the price line mainly of the essential
commodities including food articles.
The veteran parliamentarian, also the AITUC general secretary, made
these observations in his dissent note on the report of the
parliamentary standing committee on finance concerning the present
economic situation, submitted on August 29, 2012.
Unfortunately, the standing committee’s draft report as prepared
failed to critically examie the fundamentals of the economic policy
and suggest effective alternatives instead objectively approved the
policy that has been pursued by the government, he said. “It does not
even refer to the futility of the policies and non-performance of the
government. In my view, the committee did not discharge its
responsibility by patting on the back of the government.”
Saying that the present crisis cannot be attributed solely to the
international crisis, second in two years, Dasgupta said that the
present policy of unguarded liberalisation, reckless privatisation,
unusual dependence on foreign funds, over dependence on export market,
failure to curb speculation in a situation of scarcity, its total
inability to provide economic empowerment to a vast section of the
majority of the people, galloping disparity of income and increasing
unprecedented concentration of wealth in the hands of the few form the
basic negative feature that has been overlooked by the committee.
The report speaks of “economic incentive regime for accelerating and
sustaining growth.” It also states that “the committee, hence
recommend that the FDI policy may be reviewed by the government to
ensure the above and make India an increasingly attractive and
investor-friendly destination for foreign investors.” It further says:
“Our policies should attract more long-term capital inflows and push
investments through reforms.”
Thus, the CPI group leader pointed out that the observations clearly
approve the government of India’s FDI-friendly policy of economic
reform, spelling out the undeniable message that it is the foreign
investment that will engineer the process of accelerated economic
growth obviously taking care of the basic human problems. “This
proposition has not been found to be correct anywhere in the world.
The committee rejecting all the Indian realities, by implication seeks
to strengthen the hands of the government to bulldoze its
people-unfriendly economic reform. The report will give a free hand
to the government to allow FDI in the retail trade, further tax
concession to the corporates in the SEZs, it will lead to more
violation of labour laws and enable the government to infuse FDI in
the banking and insurance having proportionate voting rights. In the
name of attracting foreign funds it will bestow more concessions
undermining the national interest, making India the most attractive
hunting ground for the international players looking for unlimited
profits exploiting national resources and manpower.”
Stating that primarily the growth of the economy depends
on national resources augmenting progressive tax revenue, broadening
the tax base, reducing the tax concession, holding up tax avoidance,
by waging all out war to retrieve black money, curbing unaccounted
income, effectively fighting corruption and reducing wasteful
expenditure and relocating priorities in the process of budget making,
he said that nobody is denying the role of FDI in national
development, which by all means is subsidiary.
The direction of the report, which is extremely flawed
is stereotyped and does not search for alternative policy which the
nation is looking for. There is no word for stimulating the domestic
market, enlarging the empowerment of the marginalised majority.
The report in the background of the agricultural crisis
does not call for heavy public investment in agriculture, only asks
for ‘infusion of funds’ without indentifying the source of funds.
While investment in agriculture has been dwindling down over years,
both public and private, the report does not “look beyond the nose,
makes a superfluous comment on the need of infusion of funds, which is
unlikely to happen.”
“Nevertheless it is correct to say that private investment has a
crucial role in a mixed economy like India. But in a situation of
gloom and downturn, it is massive government investment targeted to
augment the income of the common people, for creating job, ensuring
stability of income of the disadvantaged, even incurring budget
deficit can turn around the economy. Heavy government investment will
stimulate the market, generate the income, improve aggregate demand
and as a result market shall look up creating the atmosphere for the
inflow of profit oriented private investment, even draw foreign funds.
Unfortunately, the alternative perception is ignored and discarded by
the Report and in fact it strengthens the hands of the government to
carry forward the present anti-people economic policies”, the dissent
note adds.
Criticising the government for recommending the sale of family silver
to meet the grocer’s bill, he said that the report suggests
disinvestment for raising revenue, when the market sentiment is so
negative. “The Committee unfortunately goes so far as to suggest 10
per cent reduction in the non-plan expenditure which essentially
suggests to reduce subsidy obviously hurting the common people. This
is quite in line with what the present government wants to do. In the
name of quoting RBI, the report puts on record with concern the
question of overshooting of subsidies.”
The committee, he says, “even refers to with concern the impact of
‘retrospective tax laws’ and ‘general anti-tax avoidance rules’. It
calls upon the Government to modify/withdrawal these laws so that
investors’ interest is not hurt. It calls upon the government for the
speedy enactment of the financial reform Bill including Pension Fund
Regulatory and Development Authority Bill, the Companies Law Amendment
Bill. The report undoubtedly shall be a feather in the cap of Dr
Manmohan Singh’s government.”
The report in the name of strengthening the health of the banks “seeks
to permit the government for going for merger of the banks undermining
the national interest. It also opens the door for private investment
in banks diluting its public sector character.”
Since the report is one sided, seeks to strengthen the
hand of the government in pushing through all its corporate friendly
reform programme at the cost of the interest of the people, since the
report does not locate the fundamental anachronism in the economic
policy that has led to a situation of slowdown and food inflation,
almost taking the country to the threshold stagflation, since the
report is in fact an apology for the inaction of the government and
since the report does not find any fundamental flaw in the policy and
refrains from outlining people friendly suggestions Dasgupta made it
clear that he has no other alternative but to put on record his
dissent. “It is unfortunate that the report is likely to serve as a
readymade weapon in the hand of the government to defend its failed
economic policy running the country.”
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