There is basically a huge and growing demand-supply mismatch in the Indian economy. The declining world economy, too, does not provide hope of an expansion that could fuel growth in India. A vast parasitic structure of corruption has come up on the back of the shortfall, creating a vested interest in the continuation of the present situation. The increasing disparities in incomes come from this phenomenon and not, as some would have it, from market oriented, liberal economic policies. In actual fact, the vested interests cleverly exploit these sentiments to ensure that the status-quo continues. Populist politics has emerged from this situation, which the governments fear would oust them from office if phase two of economic reforms is implemented. This is in spite of the abundant evidence that development is rapidly becoming central to winning elections.
The timid performance of UPA-II in this regard – always finding an excuse to back down in the face of one or the other belligerent ally – has only resulted in its losing political ground in a massive way. The farce played out in Parliament on Thursday – pithily commented on by Leader of the Opposition in the Lok Sabha, Sushma Swaraj – indicates the level to which the government has sunk. The only conceivable reason that the government continues to suffer this embarrassment is that it is content with the situation – a substantial number of its constituents profit from the current state of the economy. The inefficiencies, the irregularities, the grey areas only serve to fill the coffers of a range of those with discretionary power – from the BDO in the administration right to the top. The disclosure of the fortunes amassed by petty officers and political functionaries are daily reminders of this fact in the columns of the newspapers.
The situation, however, has become untenable. One need not be reminded of it by the state of the railways or the airlines – the entire infrastructure of India’s developing economy is under severe stress, on the verge of catastrophic collapse. The only sector of the economy that is shining is that built on untaxed wealth. It is only the section that need not distinguish between white and black money that is growing, however, it too requires an improvement in the general environment to continue to do so. Gurgaon might have a lot of pubs because of the disposable incomes of its residents, but it cannot afford a pub-going culture because of the poor governance! The only solution offered – pubs must be decongested, euphemism for ‘close them down’.
One may close down the pubs, but more fundamental demands such as food, schools, roads, hospitals cannot be denied. Disregard for the principles of economics in the name of political ideology has brought Bengal, for instance, to a position that it has almost nothing in the form of public infrastructure or services. The horror stories emanating from there attest to this fact. The populism of Mamata Banerjee does not promise any better for that state or the nation.
Should the UPA complete its term in this lame-duck manner, or make an effort to live by its basic raison d’etre? An example can be taken from the recently departed BJP regime in Uttarakhand, for whom the verdict was on the cards – last minute efforts were, however, made to correct the policies and the day was almost won. Khanduri’s BJP had only a few months, the UPA has two years to go. If it makes the effort, it can still turn the tables on the nay-sayers, within and without.
