Editorial 1: India needs a new economic policy
Introduction
- The National Statistical Office (NSO) has released the 2022-23 GDP fourth-quarter growth rate figures. Measured against fourth-quarter figures of the previous year, the data give a gloomier picture than what the media publications of the Press Information Bureau present.
The NSO Data conclusions
- According to NSO data, in the first COVID-19 pandemic quarter of 2020-21, i.e., April 1 to June 30, 2020, GDP growth rate was minus 23.8% when compared to GDP of the same period in 2019-20.
- Three conclusions based on NSO data since 2014-2015 are important for a reality check.
- First, the growth rate of GDP, since 2015-16 had been declining annually, and has fallen in the fourth quarter to what it was earlier, and sneeringly referred to by economists as “The Hindu Rate of Growth” — 3.5% growth rate in GDP.
- Second, it is essential to recognise that since 2014, Prime Minister Narendra Modi’s widely publicised “Vikas” in reality achieved the so-called “Hindu rate of growth” in GDP of what had been achieved in the period 1950-77 — the socialism period.
- Third, during the tenures of P.V. Narasimha Rao and Manmohan Singh, GDP growth rates rose for the first time to between 6% to 8% per year over a 15-year period, i.e., 1991-96 and 2004-2014 (with the usual cyclic ups and downs).
The alarming situation
- What is alarming today is the serious and continuous decline in GDP growth rates which began in 2016. And that decline continues even now.
- The growth rate of GDP has been consistently in decline since 2016.
- No policy structuring has been presented.
Steps to be taken
- By “structuring”, this writer means a clear implementation of what the economic objectives will be, and priorities that should be assigned to the various objectives.
- Thereafter, there ought to be a strategy on what should be incentivised and what should be deleted or discontinued.
- For example, in today’s dark economic condition, it is essential that personal income tax is abolished and Goods and Services Tax scrapped to incentivise investors and earners.
- Resources by the government should be mobilised through indirect taxes and also by liberal printing of currency notes and which is circulated by paying wages to the employment generated in extensive public works.
- The annual interest paid on fixed-term savings in bank accounts should be 9% or so to increase purchasing power of the middle classes. Interest rates on loans to small and medium industries should be no more than 6% of the loans to increase production of these sectors, and thus employment.
- India needs a new economic policy urgently. It needs to be a policy that is based on clear objectives, priorities, have a strategy to achieve targets, and spell out an intelligent and transparent resource mobilisation plan to finance policies.
- The market system is not a free-for-all or an ad hoc measure. It has a structure with rules for transactions.
- Market system capitalism works as the principal drivers are incentive and capital (whose use for innovation raises factory productivity and the growth rate of GDP).
- Deregulations should also not mean that we reject government intervention for safety nets, affirmative action, market failure and creating a level-playing field.
- Democratic institutions have to be empowered to guard against public disorder arising from rapid de-regulation — as it happened in Russia post-1991.
Way forward
- The trade-off between the public sector and de-regulation and the sale of loss-making units, increasing employment, through affirmative action, and easy access to social security and a safety net are essential to create a stake for the poor in the system.
- This creates a level-playing field in a competitive system, ensures transparency, accountability, and trusteeship (philanthropy), as well as corporate governance to legitimise profit-making smoothly which drives the market system.
- Such steps reduce monopolistic tendencies and help in the formation of a democratic and harmonious society.
Editorial 2: Demolitions as state-sanctioned collective punishment
Context
- The demolitions in Nuh are just the latest iteration of what has come to be called “bulldozer justice”. For more than a year, from Khargone in Madhya Pradesh, to Khambhat in Gujarat, to Jahangirpuri in Delhi, to Nagaon in Assam, to many others, the demolition of homes as a form of frontier justice has become a standard feature of administration.
A fig-leaf of legitimacy that falls away
- In carrying out the demolitions, the state and its officials speak with a forked tongue.
- The public and official justification is that the demolitions are carried out in order to remove “illegal structures” or “encroachments”.
- Municipal laws that authorise the removal of unauthorised structures are invoked as the legal cover for such action. This is the justification the state sticks to when it is challenged in court.
- However, even as it does so, politicians, and at times, even officials of the administration, go on record to say that the purpose of the demolitions is to “teach a lesson” to alleged rioters.
- First, it is important to note that the state’s public justification fails on its own terms. Over the years, the courts have recognised that what we euphemistically refer to as “unauthorised structures” are often the dwelling places of economically marginalised and vulnerable people, who have been failed by the state in its obligation to provide shelter to all its citizens.
- Consequently, other than enforcing basic procedural requirements — such as adequate notice — courts have also insisted that before demolitions are carried out, the administration must conduct a survey to check whether the residents are eligible for rehabilitation schemes, and if so, complete their rehabilitation before any demolitions are done.
- Rehabilitation, in turn, does not simply mean picking up people from one part of the town and dumping them in another, but ensuring that there is no substantial disruption to their (already) precarious lives.
- The basic purpose is to ensure that the state does not simply make its own citizens homeless, and with no recourse. Doing so is a marker of an uncivilised society.
- It is obvious that the instant demolitions that we see do not comply with these procedural or substantive requirements.
- The state’s attempts to provide a fig-leaf of legitimacy to its demolitions, therefore, fall away at the slightest scrutiny.
A form of frontier justice
- But at the end of the day, everyone knows that what is happening is not a dispute over municipal law, zoning regulations, and “unauthorised” structures.
- It is clear that what is happening is state-sanctioned collective punishment, which is predominantly targeted against specific communities.
- Instead of engaging the machinery of law enforcement and justice — which is what states bound by the rule of law do — the state prefers to mete out a form of frontier justice, enforcing order through violence, and itself becoming the law-breaker.
- Bulldozer justice might satisfy the anger of people who have been caught up in riots, and who are accustomed to seeing the criminal justice system grind on for years without result.
- Indeed, whether it is extra-judicial killings or home demolitions, this is indeed the justification that is trotted out: that the courts are too slow, too prone to giving bail, and too indulgent in handing out acquittals.
- Bulldozer justice is a form of collective punishment, where punishment is not only meted out before guilt is proven, but along with the supposedly guilty individual, their innocent family members are also punished.
- Furthermore, punishment without guilt — punishment at the discretion of the state — violates the rule of law.
- The rule of law is all that stands between a marauding state and the basic safety of individuals.
- Abandoning the rule of law for frontier justice is the first step towards an authoritarian society where one’s safety, physical possessions, and even life and liberty, will be at the whims and fancies of state officials.
Way forward
- In this context, it falls to the courts to enforce the rule of law and the Constitution.
- Unfortunately, for more than a year, the courts have been silent; even the Supreme Court of India has, when faced with this situation, purported to accept the state’s justification of going after “unauthorised structures.”
- One hopes that it is the beginning of the judiciary reinforcing basic constitutional principles and values against state impunity.
