Enough excuses, time for Shri Modi to deliver
A few days ago the Prime Minister said,"I have taken over reins of the country in circumstances where there is nothing left behind by the previous Government. They left everything empty. The country's financial health has hit the bottom. "
A few days ago the Prime Minister said,"I have taken over reins of the country in circumstances where there is nothing left behind by the previous Government. They left everything empty. The country's financial health has hit the bottom. "
We would have ignored the remarks as part of the political rhetoric that started during the election campaign. However, similar remarks have been made by others as well.
We are therefore obliged to ask a few questions:
1. Did the Prime Minister refer to the cash balance of the government?
The opening cash balance on june 1,2004, just after the NDA Government demitted office, was negative Rs.2730 crore. There was a 'ways and means' advance on that date. On the other hand, the opening cash balance on june 1, 2014, just after the UPA Government demitted office, was Rs. 26,510 crore. We do not subscribe to the "empty coffers" theory but, for the sake of argument, we would like to ask "who left behind an empty treasury"?
1. Did the Prime Minister refer to the cash balance of the government?
The opening cash balance on june 1,2004, just after the NDA Government demitted office, was negative Rs.2730 crore. There was a 'ways and means' advance on that date. On the other hand, the opening cash balance on june 1, 2014, just after the UPA Government demitted office, was Rs. 26,510 crore. We do not subscribe to the "empty coffers" theory but, for the sake of argument, we would like to ask "who left behind an empty treasury"?
2. Did the Prime Minister refer to the foreign exchange reserves?
Strictly speaking, the foreign exchange reserves do not belong to the government. Nevertheless, if the Prime Minister was referring to the reserves, at the end of 2003-04, just before the UPA government assumed office, the reserves stood at USD 113 billion. On the other hand, at the end of 2013-14, just before the NDA Government assumed office, the reserves stood at USD 304 billion. At the end of 31.5.2014, the reserves stood at USD 312 billion. So, who left behind more foreign exchange reserves?
Strictly speaking, the foreign exchange reserves do not belong to the government. Nevertheless, if the Prime Minister was referring to the reserves, at the end of 2003-04, just before the UPA government assumed office, the reserves stood at USD 113 billion. On the other hand, at the end of 2013-14, just before the NDA Government assumed office, the reserves stood at USD 304 billion. At the end of 31.5.2014, the reserves stood at USD 312 billion. So, who left behind more foreign exchange reserves?
3. Did the Prime Minister refer to the outstanding liabilities of the Central Government?
Since 1950-51, the Central Government has always had liabilities which include public debt and other liabilities. Assuming that the Prime Minister's argument was that the government has high debt, that is indeed true. For many, many years, the government has incurred a fiscal deficit every year, which means that the Government has added to the public debt every year. It was no different when the Congress had formed the Government, it was no different when the NDA was in office between 1998 and 2004, and it was no different when the UPA was in office between 2004 and 2014. And if we may make a prediction, it will be no different during the period of the Modi sarkar.
Since 1950-51, the Central Government has always had liabilities which include public debt and other liabilities. Assuming that the Prime Minister's argument was that the government has high debt, that is indeed true. For many, many years, the government has incurred a fiscal deficit every year, which means that the Government has added to the public debt every year. It was no different when the Congress had formed the Government, it was no different when the NDA was in office between 1998 and 2004, and it was no different when the UPA was in office between 2004 and 2014. And if we may make a prediction, it will be no different during the period of the Modi sarkar.
4. What did the Prime Minister mean when he said "There is nothing left behind"?
We may remind the new Government that we left behind 243,000 MW of installed power capacity and 207 million tonnes of petroleum refining capacity.
We left behind an economy that had raised coal and lignite production to 562 million tonnes; steel production to 82.2 million tonnes; fertilizer production to 36.5 million tonnes; and cement production to 25.6 million tonnes.
We left behind a farm sector that produced 263 million tonnes of food grain last year. We left behind a stock of 34.4 million tonnes of wheat and 28.4 million tonnes of rice with FCI on May 1,2014.
We left behind 389,578 kilometers of rural roads built under PMGSY.
We left behind a universal mid-day meal scheme, a generous education loan programme and a scaled-up National Skill Development Mission which have touched the lives of millions of people.
We left behind an economy where the fiscal deficit has been reduced, the current account deficit has been sharply contained, and a clear path of fiscal consolidation has been laid out. We also left behind a 10-point agenda which contains a vision for the future.
In conclusion, we would like to say that the state of the Indian economy has to be seen in the context of the world economy. There will be ups and downs, and these will be reflected in the state of the Indian economy.
We enjoyed a golden period between 2004 and 2008. Thereafter, the international financial crisis, now described by economists as the great recession, hit all countries including India. The crisis is not yet over. Estimates of world economic growth have been revised downwards in the last few days. For example, the US which was expected to grow in 2014 at 2.8 percent is now expected to grow only at 2.1-2.3 percent. Hence, the Indian economy will face head winds. The government of the day is obliged to assess the situation from time to time and take appropriate measures.
We may remind the new Government that we left behind 243,000 MW of installed power capacity and 207 million tonnes of petroleum refining capacity.
We left behind an economy that had raised coal and lignite production to 562 million tonnes; steel production to 82.2 million tonnes; fertilizer production to 36.5 million tonnes; and cement production to 25.6 million tonnes.
We left behind a farm sector that produced 263 million tonnes of food grain last year. We left behind a stock of 34.4 million tonnes of wheat and 28.4 million tonnes of rice with FCI on May 1,2014.
We left behind 389,578 kilometers of rural roads built under PMGSY.
We left behind a universal mid-day meal scheme, a generous education loan programme and a scaled-up National Skill Development Mission which have touched the lives of millions of people.
We left behind an economy where the fiscal deficit has been reduced, the current account deficit has been sharply contained, and a clear path of fiscal consolidation has been laid out. We also left behind a 10-point agenda which contains a vision for the future.
In conclusion, we would like to say that the state of the Indian economy has to be seen in the context of the world economy. There will be ups and downs, and these will be reflected in the state of the Indian economy.
We enjoyed a golden period between 2004 and 2008. Thereafter, the international financial crisis, now described by economists as the great recession, hit all countries including India. The crisis is not yet over. Estimates of world economic growth have been revised downwards in the last few days. For example, the US which was expected to grow in 2014 at 2.8 percent is now expected to grow only at 2.1-2.3 percent. Hence, the Indian economy will face head winds. The government of the day is obliged to assess the situation from time to time and take appropriate measures.
We would be happy if the BJP comes out of the campaign mode and gets to the business of governing the country.
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