Tax-and-spend policies killing rural India

According to all indications the Union Budget for the year 2008-09 scheduled to be presented to Parliament and the people almost a week before this March issue of EducationWorld hits the newsstands, will offer a large number of sops and concessions to Indiaƒšžs 700 million heavily indebted and suicide-prone farmers who to all intents and purposes seem to have been entirely bypassed by shining Indiaƒšžs miracle economic growth story of the past 15 years. The new fiscal year beginning April 1 is a general election year. And when itƒšžs time to go to the hustings, the countryƒšžs forgotten farmers who constitute over two-thirds of the electorate, loom large in the minds of all politicians. The standard response of governments at the Centre and in the states to the spate of farmer suicides across the country is to proclaim new credit packages, reschedule bank loans and offer loan waiver schemes in badly hit parts of the country. But these standard responses are of limited value because largely illiterate farmers shun paperwork-intensive nationalised banks. Surprisingly Indiaƒšžs famous economists of international repute seem unable to grasp the self-evident structural problems of rural India ƒš‚ mass distress selling of farm produce because of the lack of storage facilities, poor rural-urban connectivity, and high transport and farm input costs. The utter insensitivity of the Delhi durbar, notable for its conspicuous consumption and waste of taxpayers money, to the impact of its tax-and-spend policies upon the silent majority in rural India, is highlighted by the recent decision of the Union cabinet to raise the price of diesel and petrol by Rs.2 and Re.1 with effect from February 15. This ill-advised hike in the prices of motor fuels rationalised by the rise in price of crude oil in the international market to $100 per barrel, has been silently accepted ƒš‚ even welcomed ƒš‚ by shining Indiaƒšžs prosperous urban middle class without care for its effect upon the countryƒšžs already over-burdened rural majority. The plain truth glossed over by the glamour-obsessed middle class media is that even at currently ruling crude oil prices, shorn of all taxes and imposts, the ex-refinery, pump-site cost of petrol priced at Rs.54 per litre (in Bangalore) is a mere Rs.20. The remainder of motor spirit prices payable by hapless citizens accrue to the Central and state governments by way of customs, excise, sales tax, and sundry cesses aggregating a humungous Rs.155,000 crore per year (exclusive of additional revenue accrual following the latest price hike). Instead of raising petrol/diesel prices to protect their revenue, most of which is recklessly spent on non-productive establishment expenses, why canƒšžt the Central and state governments cut down their revenue expenditure, i.e on foreign junkets, motor-car cavalcades, lavish perquisites of office, support to loss-making public sector enterprises etc? Why should budgetary adjustments to accommodate higher motor fuel prices be made only by citizens, particularly the poor? The answer to this question provides the explanation for the pitiable condition of the overwhelming majority of rural Indiaƒšžs 160 million suicide-prone households. Public interest demands exemplary punishmentThe anti-northerner riots in Mumbai and smaller cities of Maharashtra ƒš‚ Indiaƒšžs most industrialised state ƒš‚ which has reportedly prompted over 10,000 Indian citizens of Uttar Pradesh and Bihar origin to flee Maharashtra in early February, highlights the prime infirmity of the Indian State (Central and state governments) which has crippled the post-independence national development effort: chronic failure to maintain law and order. Continuous failure of the Indian ƒš‹“soft stateƒšž to vigorously prosecute and convict political and religious zealots for incendiary speeches and statements clearly prohibited by law (ss. 153 and 153-A of the Indian Penal Code, 1860), has created a huge community of anti-social looters, plunderers and worse across the country who have escaped punishment for heinous crimes against society. In the circumstances itƒšžs hardly surprising that desperate politicians donƒšžt think twice about making inflammatory speeches calculated to goad professional rioters and gullible, ill-educated youth to acts of civil insurrection and violence. In the instant case, the Congress-led Maharashtra state government exhibited patent reluctance to arrest and vigorously prosecute Raj Thackeray, the promoter-leader of the Maharashtra Navnirman Sena (MNS) ƒš‚ a breakaway splinter of the Shiv Sena party which has risen to power and popularity in Mumbai by uninterrupted rabble-rousing for over three decades. His pro forma arrest on February 13 and immediate release on bail thereafter, reaffirmed the reluctance of the State and judiciary to visit the full rigour of the law upon incendiary politicians and their lumpen followers. For this dangerous development, post-independence Indiaƒšžs lackadaisical and unwarrantedly over-hyped judiciary is as much to blame as the countryƒšžs sui generis tribe of politicians driven by electoral arithmetic and majority-pandering political calculation. Almost two decades ago this writer (your editor) together with the late senior bureaucrat J.B. DƒšžSouza under the aegis of the Peoples Union for Civil Liberties initiated criminal prosecution proceedings in the Bombay high court under ss. 153 and 153-A IPC against Shiv Sena supremo Bal Thackeray for instigating the anti-Muslim riots of 1992-93 in Mumbai. Although argued in the Bombay high court and the Supreme Court by senior counsel Atul Setalvad, the case and the appeal were summarily dismissed without written judgements explaining the ratio decidendi of the courts. Quite clearly the will to bring hate-mongering politicians to book is as lacking in the judiciary as it is within the political class. Criminal prosecution of Raj Thackeray under the said provisions of the Indian Penal Code by the State is very necessary to send out a clear signal to incumbent and aspiring politicians that violations of the penal code which prohibits sectarian and communal propaganda, will attract the full force of the law. Violation of the provisions of ss. 153 and 153-A IPC mandates a maximum prison sentence of three years. It should be imposed upon Raj Thackeray by way of exemplary punishment. The public interest demands it.