Bharat Mata Ki Jai (II): The intricate economic web

Finally back into my writing boots, holding the pen once again, yes I did write this on paper first, I am back after a void of some fifteen days. A lot has happened in these fifteen or so days. Time has taken its toll upon me and my ideologies. Parting myself from some ideas that were no more than a fad, I have moved on in life….Ah! Abstaining myself from indulging into serious philosophies of life let me put forth the second part, or call it the sequel, the sociological approach to Indian economic condition, Bharat Mata Ki Jai(II): The intricate economic web.

I concluded my last article BMKJ(I), with a promise to include the heavy weighted terms of Sociological perspective and approach, Inflation, Deficit, Subbarao etc. But merely placing them in a fancy statement would never fulfil their actual job. To understand the Indian policy paralysis, or call it the economic slowdown of the nation, we need to realize that this country as a whole is a system which is interdependent and thus is very fragile. The first very obvious question that may come to your mind is that why a drop as low as ₹56 a $? The most potent cause to this is the Eurozone debt crisis which has caused the tremendous weakening of Euro and hence in other perspective a comparative strengthening of dollar against other currencies, which includes Indian rupee. But nowhere does this dropping of Indian rupee states that we are in a crisis. This is a global situation wherein such effects are faced by every other nation.  The platform might be dropped but why do we fail to realize that we all are standing on the same platform even now? The previous IMF chief the waitress-assaulter Strauss Kahn said in an exclusive interview that India is one of the strongest and dynamically growing economies at present. Because of the ferocious potential that we Indians possess, all we have in hand right now is a little concern but NOT at all a CRISIS. Anyways, as a matter of fact, Indian Rupee is stronger that Japanese Yen (Any comments??).

The current economic situation is an assembled model of many centrally important issues. To present an inception lets pounder on Subsidies. These are the financial support that the government, both centre as well as state provides, on agricultural production activities, petroleum and oil etc… If we look into the total cost of subsidies provided by government in the year 2011-12, it sums up to a mammoth ₹1.8 lakh crore. Almost efficiently comparable to the defence budget of our country (₹1.9 lakh crore). As per my personal views I believe this is too much of money to be given cheeringly to the corrupt, as that is where most of it goes. The government has a poor PDS system, unable to counter even a fake ration card problem. Talk about Rajasthan where the net productivity of wheat is around 69.5 metric tonnes per season but available quantity in sacks, to store them is merely 25 metric tonnes. Can you believe the rest of the wheat either deteriorates on railway stations or in overflowing granaries? Why so much of subsidies for higher yield, when you can’t even store it. This is simply a waste of money. Rural development minister Jairam Ramesh recently said in an interview that the government should remove the petroleum subsidy. But soon this was covered under the veil of political agendas and propagandas.

Now let’s take a toll on the auspicious sentiments of our fellow respected Indian citizens, privileging themselves in prestigious offices of Finance ministry and Central Bank. There had always been a discontent and a clash of ideas between the present RBI Governor Subbaro and our past Finance minister Parnabda. The latter requested him many times to reduce the interest rates(Repo rates- at which banks lend from RBI), to curb the investment sentiment prevailing among the public, but the former never gave him a look more than that of ignorance. Subbaro comments, that the rates were higher in 2008-09 but the GDP growth rate was higher than. What needs to be checked are the government policies. While as for now Pranaba orates his first Presidential speech and relaxes in the presidential office, we can hope Shinde to infuse the negative miasma that prevails in the street joining Finance ministry and RBI.

Another potent reason that I feel is the government’s decision to prevent the entry of foreign Investment of higher celling’s in multi retail sector. This is again the display of another infant industry approach adopted by the government like the one adopted in late 1980’s. You will keep arguing that we need time to grow while other infants will face the competitions and grow in the rat-race environment. But all this doesn’t stop here, the government is not only allowing foreign investment but is also planning to tax the somewhat present investors to settle its CAD(Current account deficit). In the Vodafone case, for a transfer of rights, Vodafone is charged of rupee 11,000 crore tax. Moreover they are providing to IMF, a relief package of ₹55,000 for Eurozone crisis, but kicking Mrs. Banerjee's proposal of a state relief fund. Then the horrific appearance of GAAR in the dreams of enthusiastic foreign investors is driving the optimism out of their nose. In such a scenario the government should allow FDI in multi brand retail, banking, aviation and keep cases like Vodafone out of their box, otherwise we will even loose out current investors.

To compile everything into a machine code,what I wrote plus what I cannot, considering your temperament to engulf this boring stuff, now let’s try to take the help of our special characters…

CUT RATES TO CURB INFLATION>>DEISEL DEREGULATION AND CONTROL>>PREVENT FINANCIAL PACKAGES>>PREVENT HIGH FLOATING SUBSIDIES>>ALLOW FDI>>CONROLL CAD>>REVIVE TELECOM AND MINIG SECOTR>>CURB NEGATIVE SENTIMENTS ABOUT ECONOMY SPREAD IN SOCEITY.

That’s how I perceive this…

Bharat maata ki Bharat maata ki bolo jai bolo jai bharat maata ki jai….

Thanks for Reading..

Have a nice day…