Many thanks for the comprehensive, balanced and well-written pre-election report by Sunita Sohrabji in India-West entitled, “India Elections Begin: No Party Will Win Outright, Predict U.S. Analysts.”
I wish to supplement on the above subject. One point many parties state is that the BJP’s record has been poor and they will outperform. While I am not an economist, there are some points that need to be borne in mind about this.
Ever since the advent of Manmohanomics in 1991, the private sector seems to occupy a premier position. It has its pluses and minuses. Some of these are:
Firstly, the tremendous amount of NPA. I believe that these arise mostly from the borrowings by the private sector. They are a drag on the lenders and the borrowers. These huge sums of money could have been for job creation.
Secondly, for the private sector the main index of performance are supposed to be profitability which has been not in many cases for the public sector. Job creation is not a priority for the private sector. Also being a free enterprise the government cannot compel the private sector to direct their activities with job creation as their index of performance.
Third, there are some other factors that are not obvious with respect to the private sector. An example is the coal scam. Why did not the private sector develop the coal mines? This would have created jobs. Instead coal had to be imported with avoidable expenditure of foreign exchange.
Fourth, oil exploration does not seem to be a priority. Chaturthan Mishra was a minister in a coalition government. He pointed out that in the sale of petroleum products there was a tax for exploration, but it was transferred to general fund. This obviously reduces the priority on exploration. Also, a geologist Roy Chaudhuri with ONGC said that there are deposits that need to explored and developed. Blocks were allotted to giant oil companies for oil exploration, but nothing substantial seems to has come out. The separation of Mynamar (Burma) and Sylhet going to East Pakistan deprived India of petroleum. Defense imports are another example. All the foreign exchange used for oil and defense imports could have been saved and used to create jobs.
Fifthly, Dr. Raghuram Rajan said that rural agriculture cannot provide much employment opportunities as it is almost full. Some other avenues have to be opened.
Sixthly, look at the social norms which lack dignity of labor. Mahatma Gandhi's emphasis on dignity of labor cannot be overstressed.
Seventhly, look at the vast inequality in remuneration, especially in the private sector. Mahatma Gandhi rightly emphasized the narrowing of the gap.
How will any party address the above matters on coming to power is a question that needs to be explored if the election planks are not to remain pipe dreams. I may be wrong in my analysis and happy to be corrected.