The BJP’s borrowed feathers

There is somewhat of a euphoria that our GDP growth since 2014-15 has started accelerating once again. But doubts have been expressed both within and outside government about the validity of new GDP numbers. This controversy has to be resolved without any loss of further time. I hope that we set aside politics for this purpose.

The CSO is a fine organisation and we have produced some of the finest statisticians of the world. I do hope that we will be able to settle this controversy on GDP numbers soon.

Whatever the Prime Minister and Finance Minister might say, our credibility is under question and doubt. And I certainly hope that they respect the autonomy of institutions that have stood us in good stead, such as the Reserve Bank of India, of which Indiraji had made me governor over 30 years ago.

I am all for greater untied funds being made available to State governments. But I am concerned that the Planning Commission that helped weaker States and poorer regions has been abolished hastily. Also, the Central government has a fundamental responsibility in social sectors that it simply cannot escape. It is the Centre’s funding for elementary and secondary education from the mid-1990s that has made a huge difference, and we were beginning to do so in health as well when we were in power.

But the 2015-16 Budget has been a big setback for Central allocations for essential social and human development programmes and I do not see all States being in a position to compensate for these cuts. We should ask the government to come out with a paper on the impact of the Budget proposals of 2015-16 on the combined public sector spending — Centre and States — on essential social sectors, particularly education and health.

I would also like to suggest that this is the time for States to strengthen their own planning and evaluation capabilities so that the extra resources are deployed in the best manner possible.

We made every effort to make GST a reality but we were up against an obstructionist BJP. Now of course, the BJP has become the greatest champion of GST but I am not sure that the legislation we are presently considering is the best route forward.

It helps neither the Centre nor does it help States, a least the majority of them. And if the revenue-neutral GST rate is in excess of those prevailing elsewhere, then we may not be able to derive adequate benefit from GST. As it is there are far too many exemptions and some provisions that were there in our Bill have been dropped.

The provision regarding the imposition of one per cent additional levy on supply of goods which, unlike the GST, is an origin-based and not a consumption-based taxation, also needs a fresh look. There is also merit in the demand of States for a full 100 per cent compensation for revenue losses in the first five years, unlike the provision in the present Bill for 100 per cent compensation in the first three years, 75 per cent in the fourth year, and 50 per cent in the fifth year. This is because all States may not be able to put in place the implementation architecture of the GST in a shorter period.

The prospects for this year’s monsoon look uncertain. I am sure our chief ministers have started taking preparatory action to deal with the situation that is likely to arise. Programmes like MGNREGA especially have an important role to play in alleviating distress.

We should not wait for the Centre to move but should be proactive seeking Central assistance wherever necessary.

I also think that Congress-ruled States should be setting the pace in the implementation of the National Food Security Act. I should also mention here that I worry at the cavalier manner in which the Centre is dealing with issues relating to MSP and foodgrain procurement.

Right now, the land acquisition law is the subject of intense political debate. That is because of the insensitive manner in which the Centre has tried to force through its amendments. But this is not the only area of concern.

Legislation that we introduced for the welfare of tribal communities, for the protection of the environment and forests, for empowering gram panchayats, and for bringing in transparency and accountability in administration are all being diluted in their implementation.

I am all for facilitating ease of doing business. India’s pressing social welfare objectives cannot be met unless we maintain high economic growth over a decade or two. Let us not forget that the UPA’s stellar performance on the social sectors was made possible by the 7.5 per cent annual economic growth achieved in the decade 2004-14. And this was real, not just statistical growth, I might add.

We must not be defensive about the two UPA administrations which I was privileged to head. We achieved much and transformed India in many ways. Many of our initiatives are being repackaged and are being aggressively marketed as something new.

I have to acknowledge that my successor has been a more adept salesman, event manager and communicator than me.

But the UPA story should not get lost and its solid accomplishments should not be forgotten. If the power minister of the Modi government can claim that a record 22,500 megawatt of power capacity has got commissioned in the first year of Mr Modi, it is because projects conceived by the UPA and executed in its tenure have got commissioned now. If the communications minister can claim that India is connected today, it is because three crore Indians had mobile phones in 2004 and over 80 crore in 2014.

This is the text of a speech delivered at the Congress chief ministers’ conclave in New Delhi on June 9

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