Tuesday, November 03, 2015

Isn't it great that the Prime Minister has no issues?

It is disheartening as well as puzzling to hear so many educated Indians expressing dissatisfaction with Prime Minister Modi for not carrying out 'big bang reforms'. An angry article lists all that is wrong with our political system and the actions needed to correct the problems. " Failure to pass on the full benefits of oil price to consumers, continuing a boondoggle like the Mahatma Gandhi Rural Employment Guarantee scheme, announcing a Rs 1.25 lakh crore package to the poll bound state of Bihar and the inaction on chronically sick public sector organisations thus far suggests pussyfooting on the development agenda," says the article. The author seems to have a short memory. The Congress claimed that it was subsidising petroleum products while taxing them heavily and forcing the state controlled oil companies to pay huge dividends which left them near bankruptcy. They used the money on many 'boondoggle' schemes to try and win elections while deferring payment for the subsidies on to the BJP government. To further damage government finances the Congress allowed an increase in the import and hoarding of gold when it knew that it had been booted out and no longer had the mandate to take decisions. As for increasing taxes on oil products we would argue that it is good for the economy. India imports 80% of its crude oil requirement which must be paid in dollars. The price of petrol has fallen at the pump, even with the higher tax priced in. This is not enough. The government must increase tax on diesel and lower it on petrol so that they cost the same. Ordinary people will stop buying diesel cars, reducing pollution levels, and there will not be any need for an extra tax on trucks entering Delhi, causing friction with toll collectors. The reason for bribing Bihar and going soft on failed public sector units is an attempt to increase strength in the Rajya Sabha, without which the government will not be allowed to pass vital bills, like the Goods and Services Tax bill, by the Congress. The Congress may have shot itself in the foot. Had the bill been passed last year the economy would have improved but by the time of the next elections in 2019 ennui may have set in for the Congress to benefit from anti-incumbency. As it is, the GST bill will probably pass by next year, take one year to settle in and the economy will boom by 2019. Bye bye Congress. Indian politicians will inflict any damage on the nation to stay in power. But they do greater harm when they foist their useless children on us. A study has shown how dynastic inheritance of power is bad for every aspect of the economy. The survival of the Congress lies in getting rid of the Gandhis and not in damaging the nation. Or maybe, without the Gandhis it will fall apart. Thank God Modi has no children, or issues, as they known in India. He has to perform.

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