During the first 2 years of its stint, Modi – government did a splendid job sticking to its fiscal consolidation road-map. It achieved fiscal deficit target for both 2014-15 and 2015-16. This was despite a substantial step up in the planned expenditure [a major chunk of this going into roads including rural roads, highways, irrigation, agriculture and railways] besides meeting social welfare commitments etc. This was the outcome of reforms in the area of FDI [foreign direct investment], ease of doing business and fast track approvals of stuck projects [leading to acceleration in GDP growth and buoyancy in tax receipts] on one hand and rationalization of subsidies on the other. The latter focused mainly on plugging leakages and efficient delivery...
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Category: Welfare schemes
PLUGGING FOR THE POOR IN A WELFARE STATE
The Modi Government has sought to plug the leakages in the welfare delivery mechanism. It must now sustain the momentum to achieve double-digit growth rates Three decades ago, Prime Minister Rajiv Gandhi estimated that only 15 paise out of every rupee meant for the poor actually reached them because of leakages in the delivery system. This was a tacit admission that brazen loot of public money was happening but nothing was being done to curb it. Successive political establishments happily recalled the statement but never introspected on its seriousness. In his two years in office, Prime Minister Narendra Modi not only analysed the modus operandi of how the resources meant for the poor was being misappropriated, but also galvanised the...
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Fiscal deficit ‘range’ – stepping in dangerous terrain
One of the most laudable achievements of Modi – government is its sticking to the fiscal consolidation road-map. Thus, even as it stuck to fiscal deficit [FD] target of 3.9% of GDP during 2015-16, for current year also, it has set an ambitious target of 3.5%. For 2017-18, it aims at lowering it further to 3.0%. In this backdrop, it was rather intriguing for finance minister, Arun Jaitely announcing [budget speech for 2016-17], the government’s intent to review Fiscal Responsibility and Budget Management [FRBM] Act with a view to make the target flexible. He was alluding to make it range bound instead of a fixed number as has been the position hitherto under the extant Act in vogue since 2003....
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Empowering poor via stemming loot
On completion of 2 years in office, Modi – government is presently taking stock of what it has done and its achievements. Even while directing all his cabinet ministers to disseminate their work to the public at large, prime minister himself has taken the lead and is addressing a number of public rallies to highlight key thrust areas. Undoubtedly, this government has many achievements to its credit and as rightly observed during his address at India Gate on May 28, 2016, highlighting all its major programs/schemes and initiatives will consume a full week of broadcast from Doordarshan [the official channel of the Government of India]. While, every bit of Team Modi’s dedicated and relentless work is worth capturing for its...
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Hapless poor in kingdom of charity
One of the fundamental rights conferred by our constitution to all citizens is the “right to work” for earning a decent living and good quality of life. This can be ensured in a sustainable manner only when the state puts in place requisite policy framework conducive to promoting entrepreneurship, mechanisms for institutional funding of projects, builds infrastructure [roads, highways, ports, rails, irrigation etc] and sets up institutions for imparting education and skills etc all essential ingredients that help create opportunities for work. For six-and-a-half decade since 1950 [the year when the constitution was adopted], these aspects received scant attention resulting in a grim scenario whereby creation of job opportunities are miniscule when compared to the needs. At present, there are...
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Poverty alleviation – Modi vs Congress
Modi’s political opponents have often accused him of dovetailing his policies and programs for the benefit of industrialists and businessmen ignoring farmers and workers. Nothing could be farther from the truth. If, there is any prime minister who has devoted maximum time to this vast constituency, it is none other than Modi. For generations, poor farmers, landless workers and millions of others were made to survive on subsidies even as a big slice of that never reached them as stated by former prime minister Rajiv Gandhi in a most condescending manner “only 15 paise out of Rs 1 allocated under welfare schemes actually reaches the beneficiaries”. There was not even a whisper of making them economically self-reliant. Modi has brought...
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Aadhaar – key to plugging leakages in welfare schemes
On March 11, 2016, the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Bill, 2016 was passed by the Lok Sabha [LS]. In the following week, the Bill was returned by the Rajya Sabha [RS] with five key amendments, but these were turned down and the LS passed it as a Money Bill. The Aadhaar Bill plans to use the identification number issued by the Unique Identification Authority of India (UIDAI), to deliver State subsidies directly into the hands (or actually, bank accounts) of beneficiaries. Aadhaar was first mooted as the Indian equivalent to the Social Security Number in the US. Aadhaar isn’t compulsory yet. The Bill is careful in stating that every resident is ‘entitled’ to...
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EPF withdrawal – hasty retreat from well crafted move
The proposal mooted by finance minister, Arun Jaitely in the Union Budget for 2016-17 to tax 60% of withdrawal from EPF [employees provident fund] and other superannuation funds has caused Modi – government much embarrassment. It faced flak from all quarters including from its own support base forcing Jaitely to withdraw the decision lock stock and barrel. The budget announcement was bandied as anti-salaried class/ common man by all and sundry. But, that is completely out of sync with the DNA of prime minister who – from the day of assuming charge – has consistently vowed to devote every moment of his work to improving the welfare of the 1.25 billion people especially the poor and down-trodden. How could his...
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2016-17 – budget that helps poor earn decent living
The Union Budget for 2016-17 presented the finance minister, Arun Jaitely on February 29, 2016 carries the imprint of prime minister Modi’s unflinching and genuine commitment to ameliorate the conditions of millions of poor – engaged in farming and other occupations – by creating all right conditions to enable them do productive work and earn good income. Driven by latter’s pledge to double farmers income by 2022 [75th year of Independence], the former has unveiled a plethora of initiatives/steps to bring about a structural transformation in the way farming is conducted and agricultural produce is marketed. Boost to farmers income & rural employment The measures that will enhance farmer’s capability to increase yield include a mammoth capital spend of Rs...
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India’s growth narrative – hits Rajan’s speed breaker
While, presenting the budget for 2015-16, finance minister, Arun Jaitely had taken a conscious decision to deviate from the fiscal consolidation road-map drawn by his predecessor and reiterated by him in budget for 2014-15. Accordingly, he fixed the fiscal deficit target as 3.9% of GDP as against 3.6% as per the road-map. The rationale behind this decision was to give a big boost to public investment in infrastructure viz., roads, highways, rails, power, port, airport etc in the backdrop of sluggish investment by the private sector [groaning under heavy debt and low margins]. The idea was to resurrect growth and push it in to double digit orbit. For 2016-17, in view of industry clamoring for continued boost in public spending...
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