The Hindu Business Line : Only a start

It was surprising to read “Instant IITs no growth recipe” (Business Line, March 3) on the move to open more IITs, IIMs, IIScs, and the loan waiver for the farmers.

He should compare India of the time when Pandit Jawaharlal Nehru conceived the idea of opening five IITs with today’s India in terms of population, status in the world and HR potential and requirements.

Today, there is no dearth of talent within and outside the country. The author’s doubt is unjustified. IITs cannot be built overnight.

Only a start has been made in this direction. Every state should have at least one IIT, one IIM, one IISc and one central university and they should be a model to other institutes.

Similarly, I do not agree with the author’s views on loan waiver. Agriculture is not viable in our economic system today. The farmer is in an economically disadvantaged position and, yet, he is forced to continue with cultivation. What percentage of a middle-class income goes towards food? Answer to this question is the answer to “What is the necessity for loan waiver?”

V. K. Sanjeevi e-mail

Not a balanced move

Though the Budget is excellent, sections of it are evocative of Mr Janardhan Poojary’s loan mela days. Banks, predominantly nationalised banks, were obliged to give loans to individuals, irrespective of their financial credentials.

Those were the days when people would queue up and the bank staff would often be attacked for not giving loans.

We now observe banks being asked to waive loans. Where will the money come? Much as the farming community needs succour, where is the provision for this resource? We expected a more balanced move towards financial management.

A New York American commented many years ago “An economist is a man who tells you what to do with your money after you have done something else with it.”

H. N. Ramakrishna e-mail

Populist policies

The article “A new Chaudhary from Harvard via Rae Bareilly?” (Business Line, March 2) on farm loan write-off was quite interesting.

This is the latest in the trend set by the UPA Government and its Finance Minister of victimising the business sector, especially PSU companies, for implementing their populist measures.

The earlier victimd of the same populist measures were oil marketing companies.

A major portion of the retail price of petrol and diesel is from the various duties, levies and taxes, most of which are also variable in nature.

So while the government has actually benefited from the increase in crude prices, the oil marketing companies are passed on the burden of subsidising the customers by selling below cost, with oil bonds being issued promising to make good part of their losses.

The basic question arising in this context is why should the Finance Ministry undertake such accounting jugglery and adopt the rob Peter to pay Paul policy.

If the government wants to introduce populist policies, it should not be at the cost of minority shareholders in PSU banks and oil companies, who also have to bear the brunt of such policies.

K. Nandu Sasidharan e-mail

More investments

This refers to the editorial, “Ideas beyond allocations” (Business Line, March 4). No doubt, the elections provoked the government to think in terms of farmer-friendly policies for the time being.

Everybody knows that mere write-offs cannot bring perpetual relief to farming. Investments, be it from the public or private sector, have to come in big chunks to agriculture.

That too, for the cultivation of major crops such as wheat, rice, pulses and vegetables and not exclusively for cash crops considering the export angle.

Irrigation facilities are to be stepped up for conversion of land to suit cultivation.

Private participation is a must in this direction. Till now, no government has encouraged this aspect.

There should be proper monitoring of the deployment of funds, allocated through the budgetary provisions. Election-oriented allocations usually do not take off properly because of lack of follow-up by the next government. The forgotten PDS system requires a thorough revamp in the present context of spiralling prices of essential commodities.

C. P. Velayudhan Nair e-mail

Towards ‘inclusive growth’

Despite rising prices in certain commodities, the Budget has all the ingredients of boosting consumer demand.

Exemption limit has been raised; agricultural loans from banks have been waived in specified categories without making the lending banks suffer; there are indications of higher government salary packages once the Pay Commission recommendations are known and this has been taken into account; provided for the expanded mid-day meals programmes for school-going children; substantial support has been given for training, education and research and development, and several other measures for the benefit of the relatively low income groups have been added. All these factors should tend towards achieving the objective of more intensified ‘inclusive growth’.

On the other hand, the Finance Minister did not tinker with rates of taxes on direct tax front.

This augurs well for a stable tax regime. Too frequent changes add to complexity and at times to confusion.

He has rightly given some relief in Customs duty. The Defence outlay has been moderately raised. On the whole, it is a tactfully balanced Budget.

K. U. Mada e-mail