Sitaram Yechury
Dr. Manmohan Singh is being paraded as the Congress spokesman on the electronic media. In a spotless while kurta-pyjama and quoting Iqbal he doles out statistics to give the impression that the past five years of economic reforms has created a el dorado in India. Many of us facing the grim realities of daily life however experience the opposite. In the face of relentless price rise increasing unemployment, fall in the living standards and the news of poverty deaths filtering in now and again such claims appear incredible to millions of Indians.
Yet, the finance minister attempts to sound very credible by quoting figures from the Planning Commission. If anything, his exercise and that of the Congress has proved the age old adage “lies, bitter lies and statistics”.
Many of us have always wondered as to the basis on which the government churns out these statistics. Last year, through these columns when we had debunked claims of the government and its so-called achievements official sources promptly released figures to show the contrary.
The cat is now out of the bag. The Economic Times the greatest supporter of the economic reforms has on 15th April, 1996 admitted on its front page that the government was actually fudging figures to project an incorrect and false picture of the economy.
“Several government spokesmen including Dr. Manmohan Singh have been claiming that real agricultural wages have risen consistently after the first year of reform, and that this proves poverty is falling steadily. But now the finance ministry has discovered an elementary error in its calculations. Its pre-budget Economic Survey claimed that real wages for unskilled agricultural workers rose by 4.72 percent in 1994-95. In fact they actually fell by 0.46 percent”. (Even we in thse columns were misled to state that they registered an increase of 0.1 percent compared to an increase of 3.3 percent between 1986-91).
“…This will come as a shock to those who have been using the Survey figures to prove that the social outcome of the reforms has been splendid after the initial year. It now appears that poverty must have deepened in two of the first four post-reform years. Worse, the 1994-95 experience shows that poverty can deepen even if the monsoon is excellent and GNP grows y an impressive 6.7 per cent.
Through these columns on the basis of the Planning Commission’s mid-term appraisal we had stated that the percentage of people below the poverty line actually increased from 35.6 percent in 1990-91 to 39.6 percent in 1994-95 (Planning Commission mid-term appraisal Chapter III table 3.11) Rao and Manmohan Singh came out with an incredible statement, which was also incorporated in the Economic Survey that the percentage dame down to 19!
The Economic Times continues : “It is wrong to assume that rapid economic growth alleviates poverty in all circumstances. In fact this will not happen if rural inflation is high, as was the case in the 1994-95 agricultural season (July-June). Normally, prices fall in a bumper monsoon year. But there was a big jump in the issue price of foodgrains to ration shops in February 1994. Since the issue prices influence open market prices, these also rose, jacking up the cost of living of poor agricultural workers, who spend most of their income on food.
“The big rise in issue prices in February 1994 was necessary to compensate for big jumps in the procurement prices earlier. No increases have been made in the issue prices since, while procurement pries have been raised every season, so another 20 percent increase in issue prices is necessary if the food subsidy is to be kept within limits. The next government will have to grasp this nettle. It is fiscally necessary, yet may deepen poverty again in 1996-97.”
So much for a government which continuously keeps harping on the point that it was the V.P. Singh led National Front government that created the crisis of such proportions that they had no option but to take recourse to the IMF and World Bank option. Apart from the above what are they leaving behind for the coming government? A whooping debt both external and internal amounting to nearly 7 lakh crores of rupees, which is 85 per cent of the country’s GDP. If India were to be forced to repay this debt at any point of time, then the nearly 100 crores of people would be left with a mere 15 percent of what the country produces leading possibly to the largest mass scale starvation deaths in history. Whereas on this date India is paying annually a sum of Rs 60,000 crores as interest. This is equivalent to the entire fiscal deficit that the budget runs upto annually.
On the other hand despite the much tomtoming of fall in the levels of poverty, it now clear that the mid-term appraisal of the Planning Commission made in 1995 was absolutely correct stating that during the last five years, atleast 6 crore more Indians were pushed below the poverty line. The offtake from the public distribution system has fallen drastically indicating that the majority of people do not have the purchasing power to buy food even when they require it the most.
Thus, these reforms, have on the one hand, mortgaged our country and, on the other, impoverished millions of people.
By now, it is clear that by using such false statistics, the entire economic survey presented to parliament and the country just before the elections was only an electoral gimmick to mislead the people.
The Indian people by now have seen through such subterfuge. If the economic sovereignty of our country is to be protected, its self-reliance strengthened and the people’s livelihood improved, this package of economic reforms has to be reversed. And this is precisely what the people will do in the coming elections by defeating the Congress and its “sleeping partner” the BJP.