BRIG HEMANT MAHAJAN NATIONAL SECURITY

Another wasteful year?

Tavleen Singh  He tried. Our poor old Finance Minister tried with his Budget to pull off an old-fashioned Indian rope trick and create the illusion that India was open for business again and that boom times were around the corner once more. He failed to convince anyone except those who like to believe in illusions. And I who have known Mr Chidambaram from the days when he understood deeply the need for reforming our stagnant ‘socialist’ economy felt bad for him. I remembered conversations from old times in which he explained why the public sector had failed to achieve what it was created for, and the vital need to cut government spending. In a dank corridor in an ugly building in Delhi in which chambers of commerce have their offices, I remember him telling me that the original idea behind the public sector was that money made from government companies would be spent on schools, hospitals and roads. He admitted that nobody knew then that the public sector would never make money. I remember vividly another conversation over lunch in the garden of a Congress leader when Mr Chidambaram explained how important it was for the government to cut spending on itself. As if it was yesterday, I remember him saying that if you lopped off the last 10 items in the demands of every ministry, it would be a massive saving and nobody would even notice. If Mr Chidambaram read The Times of India 10 days before he presented his Budget, he would have seen on its front page a report that said that if there could be a 5 per cent cut in the Rs 1.15 lakh crore that the government of India spends on the salaries and perks of its 34.1 lakh staff, there could be a saving of Rs 6,000 crore, “five times the Centre’s budgeted wealth tax collection”. The sad truth is that even if Mr Chidambaram had wanted to do such things, he could not have because his boss, Sonia Gandhi, believes that the only way the Congress party can win in 2014 is by distributing largesse to the ‘aam aadmi’, even if it bankrupts the economy. So the Budget made a provision for her food security Bill, which when it becomes law will distribute cheap grain to more than 70 per cent of the population. Judging by the scale of pilferage and corruption that other schemes of this kind has fostered, Sonia’s new idea will not work, but it may delude some voters into voting for Lady Bountiful. My problem with the sort of economic ideas that Sonia’s National Advisory Council has imposed is that they have been tried over and over again and failed every time. It was in those socialist decades when Indira Gandhi ruled supreme and our economic policy was defined by the slogan ‘Garibi hatao’ that massive welfare programmes were first born. And, as I have pointed out before in this column, had just the ICDS (Integrated Child Development Scheme) worked, we would not be today facing the sickening reality that 45 per cent of Indian children are officially malnourished. It is in my opinion our most shaming problem and I have tried on my travels to find out why it exists and discovered that at the heart of the crisis lie massive, centralised welfare schemes that are inherently flawed. My other problem with Sonia Gandhi’s largesse is that it has, ever since MNREGA began, made the glorification of poverty fashionable again. So in rural India, where the economic boom inspired even the poorest people to want real improvement in their lives and instilled in them an aspiration to one day being prosperous, they again want to be counted among the poor to benefit from government dole and cheap grain. So we are back to being the nation of beggars that we became as a consequence of Nehruvian socialism. If the hundreds of thousands of crore rupees poured into subsidies and poverty alleviation schemes had been used instead to build roads, schools and hospitals, it is my conviction that we would today have been on the verge of becoming a developed country. What is the point of bemoaning this, now that it is all over and there is not the smallest hope that anything will change before the next general election. Even if the Finance Minister had been able to change course, it may not have made a difference. Sonia Gandhi’s economic legacy is that she has taken a booming economy and ground it down to the socialist growth rates that were the hallmark of her mother-in-law’s economic policies. It is now only a matter of time before Bangladesh, Myanmar, Sri Lanka and perhaps even Pakistan streak ahead of us as we wallow once more in poverty and regain our former reputation as a nation of starving millions