"Falling Economy & Failing Sonianomics"

Mahesh Kumar Chadalawada, Freelance Journalist, Columnist & Socio Political Radio Presenter, London, United Kingdom.

Introduction: In the history of Independent India,the congress party may very well proudly describe the era between 2004-2014 as a "Welfaristic decade build up on the foundations of a special political science called Sonia-Nomics" with tens of populist schemes running up and downand length and breadth across the country. The age old Re2/- a KG rice scheme was replaced by many schemes which promise the welfare, development and up-liftmen of poor from the Below poverty line to the Above poverty line. The saga of Indian and International media passionately reporting and presenting many stories on "Emerging India started from 1991-1996 in P.V. NarasimhaRaos economic liberalisation and globalisation era and went on to heights in between 1999-2004 when Atal Bihari Vajpayee was the Prime Minister. Few wonderful books on spearheading India by eminent authors occupied the stands of famous book stores of the western world which were read by top brass business men and investors during their free time in the executive lounges, travelling in the high skies in business class flights and of course during the lunchtime meetings in silicon valley, central London, NYSE etc. created a very vibrant picture of India across the world markets.

The Humble Beginnings of UPA: Though, BJP led NDA lost the battle with "India shining" slogan in 2004,sun was really shining on UPA which won the 2004 general elections when Indian rupee was glittering with the Indias economy emerging as the best investment destination. Falling American and European markets and economic depression through out the globe gave India an overall picture as an economy build up on the classical foundations of banking principles with lots of readily available skilled man power. This was actually the pulse point of the UPAs confidence which was high and up in the sky with an overall view that they can make India as the best investment destination in Asia and especially amongst the BRICS. Thanks to the administrative and e-governance reforms laid by previous Prime Ministers who built a Modern financially Liberalised India, PV NarasimhaRao and Atal Bihari Vajpayee. When it was finally decided that Mrs.Sonia Gandhi wont be the Prime Minister of India after the 2004 general elections a loyal bureaucrat turned politician who was a successful Finance Minister in PVs Government with a credit of liberalising India,Dr.Manmohan Singh was elected as the Prime Minister by UPA. Not only India but the whole world looked with great hope and expectation towards this highly learnt, tried and tested scholarly Prime Minister and his sharp and shrewd young and energetic and highly educated Finance Minister Mr.P.Chidambaram. A Heavily Loaded Team: UPA I team included Top Finance and economic experts like Dr.Rangarajan,Dr..Montek Singh Ahluwalia, Dr.Reddy, Mr.SubbaRao and Mr.SanjayBaru etc as advisors to the Prime Minister.On the other hand Exceptionally talented bureaucrats, economists, politicians and industrialists like Prof.Swaminathan,Mr.Mihir Shaw,Prof.Pramod Tandon, Mrs.Aruna Roy and Mr.JeanDreaze etc working under the Chairmanship of Mrs.Sonia Gandhi in the National Advisory Councils which was then coined as the Shadow Cabinet by many political analysts was set up on 4th June 2004 to implement the agreed common minimum programme. Many senior congress and other party leaders who had previous experience of working as central ministers and chief ministers of various states were inducted into the cabinet. At the same time many young and energetic new faces have appeared in the cabinet to deal with few very key portfolios whose performance will really open doors to the overall economic development of the nation. The only one person who missed the flight was Mr.Rahul Gandhi, who dint come forward and for reasons best known to himself, he havent taken any responsibility in the cabinet. It would have been a great chance for him

Personally to take up some role in the cabinet in 2004 itself. It would have added to his learning curve especially working with stalwarts.Reasons unknown he dint take up any role Yes! it was really a heavily loaded team! The Journey: UPA started their journey under the leadership of Chairperson Mrs.Sonia Gandhi sitting in the treasury benches of the parliament with the support of many parties and worked out a common minimum programme for the nation mainly with the help of Leftist parties to build a Welfaristic and a Socialistic society. Principally, National Advisory Council, NAC studied many problems India is facing from so many angles like unemployment, upliftment of backward and oppressed classes and put forward thousands of proposals and the real requirements of the nation with an understanding that from time to time they are advised to Dr.Manmohans Govt to discuss and implement and get the best out to the people. There were so many schemes planned in India in many congress ruled and non congress ruled states of India and things were looking good on paper.

A Honey-Moon shattered: Bless their hearts; the UPA was having a real honey moon time. No one predicted at that time that soon the rupee will depreciate, export market will clash, joblessness will increase and there will be peak rise in the imports. No one predicted that Ten Top scams in the history of Independent India will lead to tarnish the credibility of the UPA in general and the Prime Minister in particular. None predicted that petroleum, iron ore and coal production will come to a stop and we will be pushed to stage where we have to import from other countries. No one was expecting that economically things will go as bad as they are today and Indian Rupee will fall to a high time Rs66 against a dollar.Especially, when India was evolving itself from a License Raj to a Free market policy led economy status and not only that one more step ahead a versatile destination for Foreign direct investments in retail sector. There was no speculation in any form that such an enthusiasm will come to a grinding end where many cabinet ministers were forced to be removed from the Govt. pertaining to pending charges against them and were even sent to spend sentences with countries notorious criminals in prisons like Tihar jail. The constitutional bodies like CAG, AG and CVC have to produce so many reports stating that the things are going utterly wrong in the Govt. and courts have to intervene to direct the CBI to investigate matters. With the constant battering of

the opposition finally, a stage where the PM is asked to produce the missing files in an on going coal scam investigation and the finance minister standing up in the well of the house and saying that we are fine but it is only others. The economy is working wonders and India is still emerging. The people of this nation are confused, dismayed and disappointed with a feeling of unexpected state of affairs where nothing looks guaranteed!!! Policy Paralysis: In a developing and a vast democracy like India, economic reforms are deeply associated with important legislation to remove the bottle necks. So policy making should be very swift to attract investments and engage the investors with less or no red tapism and less or no Govts involvement. But, things went other way round, especially since 2009, the countrys main opposition, courts, constitutional bodies and other agencies started submitting report after report against the Govts style of functioning and corruption in various sectors. This constant attack unexpectedly from many sides probably would have made Dr.Manmohan Singh to think twice which would have gradually progressed to thinking at least 200 times before making a single decision. The constant criticism of the opposition in and outside the parliament, non stop discussions and projections in the media, heavy pressure from peers and allies in and outside the Govt, and some strong judgements and court orders from Supreme Court the UPA virtually, got to a stage where they have to get policy wise crippled and huge delays in decision making by right people in right time. This brood to the political uncertainty and added strength to the statement too little too late". Markets not functioning as they should. No FDI coming in, no interest to invest from countries top business houses and pull out of few main international firms from setting up top business units in India POSCO,ARCELAR MITTAL etc etc..At this point there is a need to take few bold financial decisions and do simple things like reduce interest rates but we are doing other way round.Increase delays in decision making is pushing issues to a corner and boxing into a box. This in turn constantly applied unseen breaks to speeding economy and reduced options for the growth. Welfare schemes and economy: NAC under the leadership of Mrs.Sonia Gandhi want to bring more and more social protection measures under this Govts banner which some say will help UPA to win one more time in 2014 as elections are fast approaching. But,It appears like the PM was not properly listened by NAC and vice versa. After the very bad performance of Indian economy in the second quarter of this current

Financial year, It has come to a stage where nine out of Ten corporate leaders in India stated UPAs top political leadership does not believe in real growth but are concerned about their vote banks across the nation, started opting many welfare schemes with no real money available. But in terms of common man this huge money investment can be described as a classical example of the popular Hindi saying amdhani ataana karcha rupayya. The Govt for some unknown reasons failed to check and control upon the subsidies that are given in various schemes. On the other hand the working middle class are served with many types of taxes day to day. The prices of cooking gas, petrol, power and water rates are increasing every day. The prices of common commodities have arisen beyond the expectations. Food prices skyrocketed in between May 2009-May 2013 For Eg: Cereals by 38.7%,pulses by 39.9%,fruit and vegetables by 57.7%;Milk and dairy products by 59.2%; Egg, meat& Fish by 100.2% and oil seeds by 54.2%.Adding to this increase in the bank interests and loan rates putting a heavy load when paying monthly EMI towards home mortgages. Hefty school and college fees to give quality education to children. This constant battering for organising cash throughout the month is leaving the working middle class in a big stress full situation which is effecting their mental and physiological well being and ultimately effecting the quality of living mainly the urban middle and working class in India today are subjected to allot of mental stress thinking about the future of their children. The Food Security Bill: It is very good that 67% of India will be fed due to the right that this bill creates. But at what cost around Rs 1.25 lakh crores of rupees to the nations exchequer??? from where this can be organised on a yearly basis is a big question today????The price that is being given by the Govt may go high and high every year with a punctured and bleeding public distribution system and corruption at various levels in the Govt. Will the poor, needy and food less will really get the food every month!?!... One simple logic here to understand is ,naturally the first priority of any human struggle in the world is to acquire food and basing on this factor the concept of rulers, kingdoms and empires have come in the world and if Sonia Gandhi says that she will give food free of cost to all Indians then what is that we all are worried about? People can jolly well leave this struggle and enjoy the fruits that Govt is going to give them and work whenever they want as per the right to work bill provisions. Free food, free power, right to work, right to information, looks really great but what about the unseen corruption in the system that can kill the spirit of any good work that

One wants to do in our system. Come on, please be honest and fare to the people and tell them the real fact and truth that this is all is not for vote security!!! But, most crucial thing to observe here is, dont forget that our young population is our real investment.So malnutrition need to be addressed first before going ahead with a discussion on Food security Bill (FSB).What about the concept of economics first and people after" as FSB can add an extra 1.25 lakh crores on the Govts treasury. Important thing to note is Govt of India have spent lakhs of crores since many years on schemes like ICDS which failed utterly and that is the reason why Malnutrition have grown up in India and causing deaths and disabilities amongst pregnant women and young children. We have failed to give good schools, hygiene, health , quality of living and fitness to many groups of people which are very basic. Draught Economics: India was hit by many draughts and famines even after the Independence and to get self suffiency in food and diary production we have started Green revolution and White revolution. Now right to food got to be protected, but social protection for 67% is too much. Longer term risk is a agriculturally dependent economy like India will become a cereal driven rice and wheat producing nation and this may cause vegetables and farm food deprivation. This need to be taken care to avoid any major complications. There should be an in-depth discussion on what if draughts or in case of natural disasters, what if the production suffers due to any reason. As we are giving a right to people that your food will be supplied and if we are not able to supply, the Govt have to face the real problems god forbid. The key is a strong PDS and planning. No matter what ever food you give but Checking vulnerable groups, controlling contamination and maintaining hygiene standards to avoid spreading of diseases, is the key to keep nation in good health. Politics and Economics: It is clearly evident that Congress is spending money without caring for the economy. Not really sure if the PM is calculating the after effects. But, Congress says we got to invest in our children and nutrition and we are rebooting the programmes that failed to see the expected results. So, congress argues it is not about populism but it is all about caring for people. Though BJP is attacking congress everyday on FSB it is on other side saying that they got

FSB up and running in many of their ruling states.BJP says if GOI want to feed people we are happy to support but the FSB is a Vote Security Bill and congress is making it a Populist The cost has to be kept in mind and if GOI want to feed 67% of Indian people with food we will welcome and will never say a word against it but they have to explain to the general public From where this money is coming and how can we get Money in future to sustain these schemes. It is estimated that FSB will add 18% more to already existing food subsidies and total cost will be equal to the 3% of nations GDP every year. These issues were not discussed at length in the recent parliament. But we have to ask the question what the opposition plans are. They have to allow and participate in a proper discussion on the floor of parliament not only on food bill but all those 116 bills that are pending imprudently. Unfortunately the situation is very clear, session by session is getting washed away with one issue or other every single day dedicated to one person or other in the Govt or outside the Government. For example what we have to understand is without a proper discussion on the floor if a bill gets approved in the parliament with no proper safe guards to protect the interests of Govt, opposition, people, investors and other stake holders like executive a wrong processing of a file will lead to corruption, chaos and confusion at execution and delivery levels and later the same fractured bill has to be put up for amendment in the parliament. Sonia Gandhi-A Socialist-Welfarist: The NDAs bowl of contention in every discussion states that, the so called welfare Manthra of UPA is not reaching the people it is aimed to serve, this is mainly because of no proper execution, lack of tough instructions and constant follow up from the top ranks in the Govt. starting from PMs Office. They say there are too many schemes with less or no proper Govt infrastructure and administration at the ground level. For example the BJP attacked Mrs Sheila Dixits Govt saying there is no point in launching FSB in Delhi when there is no proper PDS system in place with Delhi ranking first in the list of worst PDS operated state Govts in the country. The other issue is UPA is not discussing with the state Chief Ministers in depth when ever they want to launch a new scheme in India. Since almost six decades one big debate that is constantly happening in India, what is the growth of the nation? But focussing in the recent 3 decades we had one full spell by Rajiv Gandhi where the country saw some drastic changes in the administration and in the Science and technology fronts. That particular period has laid foundation stones for the discussion of the word "Growth" compared to few growing Economies in the world. The period after that gave the Nation the taste of first ever Coalition politics and govts. The fall of congress and the beginnings of rising of Hindutva and BJPs presence in India

with the famous Speeches by Atalji and Advanis Rathyatras. During that time few Govts were not able to serve 100% for full terms for a gap of few years in between due to no proper understanding between the coalition parties. This period of darkness was followed by two PMs from two different parties with completely opposing ideologies, who have totally transformed India into a globally viable Market with liberalisation of markets and cutting down the red tape. The nation growth rate was simply appreciable during PV Narasimha Rao and Atal Bihari Vajpayees era. In this past decade of rule by Sonia Gandhi led UPA the fall in markets in India and global influences need to be studied very closely. The welfare schemes introduced should not thwart the growths, that to in a developing economy like India. A sustained economic growth is the only key to take the nation to next era and no matter political parties win or lose elections and they should not be tempted to press the button on populist schemes to woo voters who will in turn press the button on EVMs in favour of them. Today the opposition is demanding for the immediate resignation of the UPA Govt. and call for fresh elections for all the mess they have created in the economy and administration. But what we have to understand is the real dream of UPA that ,it will take at least another six months to establish systems in India so that the cash transfer scheme to the poor will come into vogue and poor can get the food and other subsidies and this will stop the oppositions from coming into power. But due to gender inequality and other social reasons like ignorance and Illiteracy the readily available money in hand may raise the chances of poor purchasing alcohol instead of food grains. Growth deceleration by 4% in the last quarter, the current account deficit which is almost 100 billion dollars making India standing next to USA and UK in the world, poor governance factor which has delayed projects worth millions of rupees due to policy paralysis has made the PM to keep silent and as there is nothing much to show to woo voters in the next general elections it appears like the Congress party is now resenting to historical aam admi politics and Garibhi Hatao politics. Adding to this, the recent introduction of another stunner bill which is portrayed as master minded by Rahul Gandhi, Land Acquisition and Rehabilitation bill which says the Govts has to pay four times the market value to the farmers in rural areas and two times the market value in urban areas if the Govt wants to acquire land and sell to industrialists. This act also says that there should be 80% agreement between all stake holders before selling and purchase of land. Just imagine the time that it consumes and can we expect any business house to

wait that much of time before they really start the business. The simple answer congress party is giving today is, this is to promote farmers, tribals and avoid any future incidents resembling Shungoor and Nandigram .Many imminent thinkers in India are already saying that the land acquisition bill will be anti poor not pro poor as the very crux of the bill itself is anti growth in the longer term due to various catches and heavily time consuming business that is involved in it. This type of political economics without a long standing future vision will leave country in a big and terrible trouble. And of course the populist schemes and bills created in the last minute without proper discussion and clarity to/for/by the 1.25 billions of people will lead us to dangerous destinies. It is high time now that the people of India should stop, think and make decisions for themselves and decide whether they continue in the same mode, where the ruling political parties woo voters by using tax payers money in the form of welfaristic schemes in turn causing irreparable damage to the countrys economy by making no growth rate or choosing those parties that offer people right to work hard and earn their bread and butter with respect and in turn be the real stake holders in the real development and real growth of the nation. !!!Do we really need welfare without growth!!! !!!Long live the dynasty and populist politics of India!!! Contact: Email:mkc176@gmail.com Tweet @ mkc176
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