Letters to the editor dated August 11, 2021

| Updated on August 11, 2021

TN economy

This refers to the editorial ‘White paper, dark picture’ (August 11). To bring Tamil Nadu out of its financial mess, the present government needs to make a clean break from the culture of competitive freebies and subsidies prevailing in the State, for long.

Notably, one of the first poll promises implemented by the DMK regime, on assuming power, was ‘free bus travel for women’.

Artificially keeping the power tariff low, fearing public backlash, is not sustainable over the long term. How is the provision of free power supply to the State’s rich farmers justified when TANGEDCO is incurring huge losses?

Increasing taxation on the rich should not result in discouraging entrepreneurship in a state which is trying hard to showcase itself as a preferred FDI destination. ‘Robbing Peter to pay Paul’, or providing subsidies out of borrowed money may look good on the silver screen, but is never good economics. A white paper would remain just that, unless followed by some tough, even if unpopular, decisions.

V Jayaraman


Curb populist measures

Tamil Nadu is saddled with a huge debt burden. The State should review aggressively a few populist measures which successive governments have been taking to corner the vote bank. One, the freebies, both in cash and in kind, have had a telling impact on the finances of the State.

Two, heavy discount or subsidy in electricity tariff, has resulted in TANGEDCO being saddled with debt. And, three, free travel for all women across the State has lead to revenue squeeze for the transport sector.

Undoing the above, will leave the State with enough resources to not only clear off the debt but also earn surplus revenue.

RV Baskaran


Online gaming

This refers to ‘Online gaming — making a play at skilling’ (August 11). Whether we like it or not online education will be the norm at least for some more months.

The mushrooming of online games in India has happened because many start-ups are venturing into this field to create innovative products. As far as market potential is concerned, if there are as many as 500 million online gamers in India then it is a huge market opportunity, which can only be neglected at our own peril.

Bal Govind


Tax on fuels

This refers to ‘Brent is below $70 but fuel prices still unchanged’ (August 11). The long-standing demand to reduce the pump price of fuels is being kept unresolved by the government to avert the possible dent in its revenues.

As the increasing price of fuels is pushing the cost of other goods and services, it is essential to cut the price of fuels by reducing the taxes on them. If inflation goes upwards, it will compel the MPC to raise policy rates which will eventually raise the cost of capital and affect the recovery and revival of the economy.

The inevitable revenue loss due to any cut in taxes on fuel needs to be equalised by the monetisation of unproductive assets of the public sector and/or the sale of government stakes.

VSK Pillai

Changanacherry, Kerala

Published on August 11, 2021

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