ECONOMY IN SHAMBLES | Intensify Struggles -D. RAJA
The Economy is in shambles. The experience has shown that NDA Government has failed to manage the economy. The relentless neo-liberal drive towards privatization and crony-capitalism has been the core of the governance. Moving away from pro-people structural reforms, the Modi-government has adamantly remained sensitive and committed to the needs of the corporate sector as the recent cuts in corporate tax and relaxation in CSR norms reflected again.
Before going into specific details, a look at how the economy is doing in macro terms is required. The decisions to demonatise high-value currency notes and the hasty implementation of GST have totally crippled the potentials of the economy. As per the latest data, India has slipped to the 5th spot among the fastest growing economies of Asia with a growth rate of about 5% in the April-June quarter, with the growth in manufacturing stagnant at 0.6%. As per the periodic Labour Force survey, which was not published before the general elections, the unemployment rate of 6.1% is at a 45 years high mostly due to the underperforming manufacturing sector. The problem of public-sector NPAs is unresolved as yet. Confusion is high among investors and trust is low, as NITI Ayog Vice-Chairman Rajiv Kumar himself accepted "This is an unprecedented situation for the government. In the last 70 years, we have not faced this sort of liquidity situation where the entire financial sector is in a churn, and nobody trusts anybody else".
In light of these basic indicators, it is easy to realize that the Prime Minister’s claim about making India a $5 trillion economy till 2024 is a distant dream and it is just one of his characteristic hollow rhetoric like “Acche Din”. The Prime Minister advised Indians to visit at least 15 tourist destinations across India before 2022 to boost tourism but this is not in tune with the ground realities. Parle-G, the largest selling biscuit brand of the country is laying off 10000 employees because of a dip in sales and meager prospects of increase in demand. These five-years of BJP-government have brought us here- where people are not even buying biscuits. Same is true for the automobile sector where the largest manufacturer Maruti is facing a 43% drop in sales on YoY basis. The layoffs in automobile sectors are in the range of 3 to 4 lakhs employees. In the much hyped gig-economy, the working situations are worsening with no social security and provident funds. This all sums up to a downward spiral of the economy and a “prolonged slowdown” as former Prime Minister Manmohan Singh recently suggested.
The steps taken by the Finance Minister to ‘boost economic activities’ reflected once again the government’s intent to cater only to the private sector at the cost of the public sector. No structural reform is announced to boost demand and create secure jobs. The decision to transfer RBI’s surplus of Rs. 1.76 lakh crores is a serious breach with the autonomy of the central bank and its buffers to deal with any uncertainty. The government is looking at RBI as a personal treasury and has systematically stripped of its independence which can potentially jeopardize entire range of monetary services in the country. By tempering with the autonomy of the central bank the government is shamelessly trying to bring down the credit ratings and trust the RBI enjoys. This transfer has brought to the fore the issues of autonomy and independence of watchdogs and the need to preserve them to maintain economic stability in the country. The withdrawal of surcharge on Foreign Portfolio Investors is also a measure taken to provide ease to the capitalists and speculators.
In view of all these, it is very clear that the government understands of economy and all its relief measures are targeted towards profit making of corporate and the big business houses. It is evident that the informal sector and the MSMEs were and are the worst hit sectors by demonetization, but the government has consistently refused to recognize this reality and has not taken any step to provide relief.
While attempting to make India a pro-investor economy by opening up all of India’s natural and human resources to loot and exploit by corporate sector The government has made India an anti-farmer and anti-labour economy. Farmer suicides continue unabated with the crisis in agricultural sector deepening. The policy decisions that are termed “labour reforms” by the centre are nothing but a way for the capitalists to exploit the country’s already impoverished working classes more efficiently with no social security and responsibility. The deepening crisis will disproportionately hurt the already deprived sections of the society by snatching away whatever little they have. The low inflation rate which the government boasts off, is coming at the cost of our farmers and peasants. They are not getting remunerative prices and this is reflected in the dip of our agricultural growth.
Similarly, the working people are passing through an unprecedented distress. It is hard to expect that the present government to change its focus from benefitting a few capitalists to the real wealth creators of the country. This looks far-fetched considering the neo-liberal, pro-corporate stance of the government. In about the last 5 years, anyone who has raised mass-issues of bread and wages has been branded anti-national, urban -naxal etc. by the government. Also, by controlling the vast chunk of mass media it has created diversions and has tried to distract the masses from their core issues. One issue after another, the media has served the interests of the government well by focusing only on superficial issues at the cost of the total neglect issues of lives and livelihood of the people. This tantamount to the blindfolding of an entire nation-state by the corporate-media-government nexus.
The self-proclaimed ‘nationalist and pro-army’ government is trying to privatize the Ordinance factories of the country which was resisted by the employees of all 41 Ordinance factories through a strike. The Modi-government is trying hard to please its corporate masters by selling national assets such as PSUs at throw away prices and the latest target in this spree is national security. Privatization of the Ordinance factories and the manufacturing of other Defense equipments will effectively mean handing over national security – external and internal to the private sector which will even put the security of our security forces in danger.
This crisis is hitting every household of the country in the form of job-losses, low agricultural productivity, debt, poverty, starvation and so on. This is a critical juncture where everyone concerned with the welfare of the country and people should join hands to resist this neo-liberal onslaught and mismanagement of the economy. Only a prolonged, sustained and sensitive people’s struggle can force this government to change its crony-corporate designs and turn the focus on the mass-issues. The government is stubborn with its policies and its ways can only be changed through mass-struggle. Every concerned citizen must resist the pro-corporate policies of this government as this is not a time to stay neutral. As the famous historian Howard Zinn once said “You can’t be neutral on a moving train”. This is a time to come together. We will have to fight to protect our rights to build our future. A future free of hunger, poverty and disease. A future of equality and egalitarianism.