Promises to keep

In an extremely rare display of honesty in admitting their failure to fulfil election promises, the PM and his government in Lebanon have resigned recently. In total contrast, in our land of Lord Ram, who is revered for his truthfulness, leaders lack honesty even to admit their failures. On the other hand, they indulge in hype, rhetoric, and falsehood to divert people's attention from all pressing issues. They have miles to go, but no promises to keep!

The election promise of the ruling party in Lebanon was curbing corruption, reviving the economy and providing basic amenities to its citizens. Although the annual per capita income of this small country of 70 lakh population is over Rs 7 lakh, most of the wealth is in the hands of the rich and the powerful corruption-cartels, leaving over 30 per cent unemployed and pushing over 50 per cent below the poverty line without basic amenities like health, etc.

In India, people voted massively for the ruling party, trusting the illusions created. However, in return, they received woes of a decadent economy, corruption in a new avatar, and religious disharmony. And now, the Coronavirus has aggravated their miseries.

Quixotic demonetisation took at least 150 lives of people in queues and had virtually wiped out the unorganised sector, small businesses, the MSMEs and self-employed ventures, robbing the livelihood and jobs of millions. But, along with the dubious electoral bonds, it has been helpful to the ruling party in elections and in engineering political defections to overthrow elected governments. The ad hoc implementation of GST has obliterated trade in farm goods and hurt the textile industry, etc. Revenue collection was affected, and public debt increased by Rs 30 lakh crore rupees, and foreign debt by $147 billion. With household savings declining from 23.5 to 16.3 per cent, consumer demand slumped, making every sector bleed, and caused a cascading effect in the sectors of capital goods, construction, ancillary industries, etc, and aggravated the already high unemployment figure of 7.9 per cent. Even the consumer retail inflation rate of 4.62 per cent breached the RBI's four per cent target. The credit crunch in banking, as well as non-banking financial institutions (NBFIs), mostly paralysed retail businesses, carmakers, home sales and heavy industries. The net result is that GDP growth has been dipping in successive quarters and touched an all-time low of 1.5 per cent, as against the false claim of the Government as 8 per cent. However, the unprecedented roll-back of corporate tax rates and concessions to new manufacturers made the stock market roar; Sensex raced over 40,000 points, and Nifty breached 12,000. At the same time, the performance of several companies has been questionable.

They could borrow funds, use inefficiently, and rely on public sector banks to paper over the resulting rocky finances while indulging in collusion and blatant frauds. NPAs went up and bank frauds reached staggering heights. But, conveniently, no asset quality review was conducted.

Further, the financial crunch did affect several infrastructure-related projects. Delays led to cost escalation in 403 of them, from Rs 20 lakh crores to Rs 24 lakh crores, as per the Ministry of Statistics and Programme Implementation, several schemes, like the 'Pradhan Mantri Awas Yojana', roads. transport, fertiliser subsidies, smart city, drinking water in rural areas, etc. were affected.

Then, the lockdown has literally frozen every economic activity, trade, travel and tourism, imports and exports, exposing banks to affected sectors to the extent of Rs 11.8 lakh crores. Stocks have plummeted in a short span of time. Surveys reveal that 136 million non-agricultural jobs across the manufacturing clusters of textiles, capital goods, cement, food products, metals, plastics, rubber and electronics, are affected. Similarly, the services sector, which is the largest employer, and covers a wide variety of activities such as trade, hotel and restaurants, transport, storage and communication, financing, insurance, real estate, retail sector, etc. is in disarray. Unemployment has shot up to over 42 per cent, and inflation skyrocketed to a record 6.09 per cent.

The present attempts in providing stimulus by printing currency, and imposing a moratorium on repayment of loans, EMIs, etc. do help in keeping the demand-supply-production cycle resuscitated. This has also helped in arresting the fall of shares, and now Sensex hovers around 30,000 points. But, once the moratorium and stimulus end, reality would dawn on investors. They are already apprehensive. Like one crore depositors have withdrawn about one lakh crore rupees from the total PF deposits of about 10 lakh crore belonging to six crore people, in just four months, primarily for medical reasons and for running their kitchens, investors are withdrawing from mutual funds, setting alarm bells in the share market.

At the same time, with supply chains of big companies collapsing, with thousands of income-generating areas passing through a crisis of existence, quite many have declared their bankruptcy. NPAs are thus likely to touch Rs 20 lakh crores by the end of this December. Even LIC is saddled with the burden of Rs 37,000 crore NPAs. Remittances of Indian abroad have also dipped by 30 per cent to $55 billion. At this crucial juncture, even the budgetary plans of the Government have gone awry.

The deficit in budget reached Rs 6.72 lakh crore in the first three months when it was expected to be 7.9 lakh crore in the financial year. Against plans to mop up Rs 24 lakh crores from GST, IT, customs, excise duty, and corporate tax, realisation in the first four months has been very poor. Similarly, as against the target of Rs 5.1 lakh crore of recoveries of NPAs, only Rs 20,000 crores could be recovered in the first three months. The Government is now focusing on the disinvestment target of 2.1 lakh crore.

Outright privatisation of some banks, sale of shares above 51 per cent in listed banks, privatisation of railways, AI, BP, BSNL, etc. are on the cards, so that banks in red could be resuscitated as the first measure.

At the same time, the Government's efforts to keep its solemn promise of making India corruption-free are intriguing, although it had come to power highlighting corruption in UPA.

It is a fact that corruption has been endemic in our political system. However, now, it is apparently 'business with the Government.'

ACB was snatched from the Delhi government to save corporate friends in the huge KG gas basin fraud. Thirty-six top fraudsters and defaulters of banks could leave the country. Even files related to their cases vanish. PSUs are being privatised; benefits likely to accrue to crony capitalists. However, the role of the watchdog, CAG, to expose such matters, like how it did in 2G and coal scams, is under dilution. As against over 200 audit reports per annum earlier, in 2019-20, only two reports were submitted to the Parliament. Now, with the ruling party's long-term loyalist bureaucrat Girish Chandra in place through a hurried order, the country cannot expect any exposure of corruption in government.

We cannot expect the current Government to follow the Lebanon way. But, in the absence of moral authority, it is sacrilege to perform 'shilanyas' at Ayodhya and touch the feet of Lord Ram, the symbol of truthfulness.

The writer is a retired IPS officer and a former Member of Public Grievances Commission, Delhi. Views expressed are personal