Now
that there is going to be an advisory council to oversee the implementation
of the United Progressive Alliance’s common minimum programme (CMP),
the key question is where will the lines be drawn on economic issues?
Congress party secretary Jairam Ramesh , who helped
draft the CMP, tells Rachna Burman that policy – making
is the result of mass politics and needs to reflect its concerns
RB:
Your CMP has been roundly criticised?
JR: By whom? By the Opposition which
would naturally do that and by sections of the media who are obsessed
with the Sensex. The CMP is a sober, responsive document that reflects
the 2004 mandate. I don’t have to make any apology, the CMP enjoys the
support of all parties, but yes, it is a Left-of-centre oriented document.
We can’t have an FII or N K Singh oriented CMP because that’s not the
verdict of 2004.
RB:
But its provisos are fiscally unsustainable
JR: DWe had six years of the NDA
government which threw fiscal rectitude out of the window. Did the media
point that out? The English language media has shown itself to be totally
out of reality with a total disconnect between causes and the individual
championing of Vajpayee, the lionisation of Chandrababu Naidu, even
my own party’s S M Krishna. Instead, this media could not point out
the real issues — the voice of the farmer in the verdicts of AP,
TN, Haryana, even Karnataka.
RB: There
is a feeling that the CMP is only a political statement of intent, with
some broad positions?
JR: The CMP is a do-able document
over a medium-term period. It is a five-year document, not a one-day
match. It marries social concerns with economic reality. This is, in
many ways, no different from the 1996 document and it has around 85
per cent of the Congress manifesto. So there are no sharp breaks from
the past — except in privatisation, which is no surprise because
the Congress and the Left are part of the alliance toget-her. Even here,
we are for privatisation, but we are against the jehadi type of privatisation
pursued by the previous government. In fact, the BJP government had
reduced reforms to privatisation; Arun Shourie had become its poster
boy and markets built up expectation and therefore a market bubble was
formed. In the CMP, we have sensible privatisation, which is very much
along the lines of what was prescribed by G V Ramakrishna, for example.
What
are the other areas they’re criticising? Review of the Electricity Act?
The Act was ramroded down the state governments by the Centre, and all
that we’re saying is don’t present only one path to power reforms, like
unbundling. The CMP only says “review”, and also, that we
welcome an increased role for private power generation and distribution.
RB: There
is also market anxiety because people feel some of these reasonable
things may not actually happen
JR: Corporate India was BJP-friendly.
Fund managers were BJP-friendly. They’ve not voted us into power. They
would have been happy with a BJP government. But what we’re having right
now are merely teething problems. The first concrete step is the Budget,
and we’ll address the problems in the Budget. Don’t you remember the
first three years of the NDA government were a disaster? The only boom
they had was the sound of the Bofors guns booming in Kargil!
RB: Even though
you now have a CMP, there are different voices on some issues in government?
JS: Economic policy-making can’t
take place in back-rooms; it is the result of mass politics, not elite
concerns. One of the great mistakes, and which I’m also party to —
I myself admit it — is that we’ve given a technocratic colour
to our reforms, that we’ve approached these issues purely from a technocratic
perspective. And that anyone who expressed concerns on this kind of
reforms was dubbed as obscurantist. We have to recognise that we are
part of a political system.
RB: So what
happens to all this hard-won buzz about India, this IT, biotech, USP?
JS: We
applaud that, but one can’t reduce all of India to IT. We applaud all
that has been done in pharma, at the way we’ve unleashed the creative
energies of our entrepreneurs, at how Indian industry has become leaner
and meaner. But we’re not an Argentina , a Russia or even a China .
We have our own political system and we have to go by that.
RB: Where
do the middle classes fit into this new emphasis?
JS: We recognise that they are a
very important segment. Surprisingly, they also voted for us —
in Delhi , in Mumbai. I think you’ll find this importance reflected
in the Budget. It is also there in the CMP, but has been missed out
in all this noise; we’ve said interest rates will provide incentives,
both to investors and to savers and that there must be a balance between
savers and borrowers. In the last two years, there has been a shift
in balance and this has hurt the interest of savers.
Also,
if you implement the Kelkar committee report, it lowers transaction
costs so it may do away with the exemptions and allowances, but there
will be a clean way of paying taxes. VAT is another area. In fact, the
2004 verdict reflects the fact that the middle class was hurt by these
wrong policies and our PR campaign highlighted that. And it resonated
very well. In my view, the BJP’s greatest mistake was to create unnecessary
hype. The UPA offers hope, BJP offers hype.
(Originally
published in The Times Of India)
Copyright The Times of India. All Rights Reserved.
