The NYAY Scheme of the Congress Prabhat Patnaik

My attitude to the NYAY scheme of the Congress is similar to my attitude to a benevolent monarchy. While a benevolent monarchy is better than a tyrannical one, any monarchy is repugnant compared to a republic. Likewise compared to the current neo-liberal regime any scheme of transfers to the poor is welcome. But NYAY amounts to a largesse by the government, an act of charity towards the bottom quintile, not the institution of a universal economic right to decent living. I find targeted transfer schemes like NYAY repugnant compared to a regime of universal rights. Poverty and unemployment in society…

The Abysmal State of Economic Decision Making Prabhat Patnaik

The minutes of the Board meeting of the Reserve Bank of India just prior to the announcement that currency notes of Rs.500 and Rs.1000 denomination were being demonetized are now available in the public domain, thanks to an RTI query. And what they reveal is the abysmal state of decision-making on economic policy that prevails under the Modi government. To be sure, economic decision-making has always been informed by class bias; but that is not what I am referring to here. Even when a decision is taken on the basis of the interests of the ruling classes, the argument for…

Housing Market Mayhem C. P. Chandrasekhar

Late in February 2019, the GST Council, prodded by the Centre, decided to modify Goods and Services Tax rates applicable to the housing sector. The declared intention was to reduce prices that home buyers would have to pay for their property. The modification, which takes effect as of 1 April 2019, involves doing away with input tax credit for residential property construction for sale and significantly reducing the GST rate applicable at the final stage of sale of housing. At present the GST rates stand at 12 per cent for normal residential housing and at 8 per cent for “affordable…

The ABC of G and T GC Harcourt

In the run up to the 2013–2014 Budget in Australia, discussion in the public domain has been intense, polemical and sometimes hysterical. Most commentators have, either explicitly or implicitly, argued that the principal criteria by which the Budget proposals should be judged are how do they contribute first, to returning the Budget to balance or, preferably, a surplus, and second, to reducing the debt to income ratio. Other criteria include matching particular expenditures by particular taxes or cuts elsewhere in expenditure, and an emphasis on the need for expenditure to be targeted rather than universal, so overlooking the demeaning effect…

The Boundaries of Welfare Prabhat Patnaik

The Narendra Modi government has now carried its penchant for undermining institutions to the national budget itself. Not only has it treated what should have been an interim budget, as its tenure lasts barely two months into the new financial year, as a full-fledged budget, but it has also palpably refrained from applying its mind to several key budgetary schemes. The aim has been not to launch some seriously thought out schemes for the poor but to create hype-worthy news. Consider the three main “sops” of the budget. Twelve crore “small landholding families” are to be given Rs 6,000 each…

Budget (Interim or Otherwise) 2019 and the Employment Crisis Jayati Ghosh

Unbelievable but true: there is nothing – repeat, nothing at all – in the Budget to deal with the job crisis. This is crazy, since lack of employment (especially for the young) and the problems in agriculture have emerged as the biggest two problems in the Indian economy and society today. It is also politically tone-deaf, since the government should really have been on the back foot on this one, as its suppression of official jobs data (the NSSO Survey of 2017-18) cleared by the National Statistical Commission, had just been exposed. In the circumstances, it was only to be…

Neither Interim, nor Substantial C. P. Chandrasekhar

In a pre-election budget speech filled with propaganda about the supposed developmental achievements of the Modi government, substitute Finance Minister Piyush Goyal read out a text that both window-dressed the revised estimates and violated all norms that should apply to an Interim Budget. Principally, the speech lays out three sets of changes on the expenditure side with the hope clearly of winning votes at election time: one to provide for a Rs. 6,000 crore cash transfer in a year to “landholding” farmers with holding size upto 2 hectares; a contributory pension scheme for unorganised workers with monthly income upto Rs.…

On the Proposal for A Universal Basic Income Prabhat Patnaik

With Rahul Gandhi’s announcement recently at Raipur that his Party had taken a “historic decision” to introduce an income guarantee scheme for the poor, and with the general anticipation that the Modi government’s last budget will also announce an income support scheme in some form, at least for the “farmers”, the idea of a “universal basic income” for the Indian population is once more in the air. This idea was mooted two years ago in the Government of India’s Economic Survey, though it was meant only for discussion and represented the views not of the government itself but rather of…

The Motivated Murder of India’s Statistical System Jayati Ghosh

The attacks by the Modi government on many of India's institutions have been noted, but the destruction of India’s statistical system was not adequately recognised or condemned. That is, not until the latest revelations on how the Government is refusing to release the NSSO’s employment survey for 2017-18 led to the resignation of the last two remaining independent Members of the National Statistical Commission. This attack on official statistics is obviously important, because it denies citizens access to reliable data on what is going on in the economy and assess the government’s performance. It is sad, because India had managed…

Here’s what Modi’s 2019 budget can – but won’t – do about India’s jobs crisis Jayati Ghosh

The Brahmastra, or ultimate weapon, of 10% reservation in government employment for economically weaker sections (EWS) has been cynically deployed already, but even that does not seem to be delivering the desired public approval. Perhaps the general public has wised up to the fact that central government jobs have in fact declined over the past four years (by more than 75,000 since 2014) and so a small reserved portion of a shrinking pie does not seem all that attractive. However, even in the limited time available, there is much a committed government can do to tackle unemployment. And these could…