People's Democracy

THE TENTH PLAN

 The Approach To The Mid-Term Appraisal 

 Suneet Chopra 

THE Planning Commission has decided to conduct a mid-term appraisal of the Tenth Five Year Plan (covering the years between 2002-03 to 2004-05). The reason is obvious. The Tenth Plan, like the one before it, was conducted under the prescription of the World Bank/IMF policies now being attempted to be thrust down our throats by the WTO despite their obvious failure to live up to the expectations the touts of the World Bank have been fostering.

What is the essence of these policies? It is the false belief that if markets are stimulated production would automatically leap forward. This belief comes apart on the basis of the fact that despite the globalisation of finance capital and investment funds, individual markets retain their individual characteristics and defend them tooth and nail, if we look at the way the USA has increased subsidies to agriculture even in the period under review and the way Europe and Japan, all of whom pay more than ten times the subsidy we pay our farmers, have refused to toe the line the WTO wishes to impose on developing countries, leading to the collapse of the Cancun summit.

This stiff resistance of the advanced capitalist countries to WTO prescriptions even when the farming population of most of these countries is 5 per cent or below of their total population, except that of France, which is 15 per cent or so, ought to awaken us to the problems such policies unleash for those of us whose agrarian population is over 70 per cent. Another point to note is that any meddling with our agrarian productive system requires a massive growth of alternative employment opportunities that have, in fact, not only failed to materialise but are not likely to materialise in the near future too.

BLEAK VIEW

So, the planning Commission’s Approach document presents a bleak view of what has actually been achieved. The mid-term appraisal, in fact, has now begun to question whether the target of an annual growth rate of GDP at 8.1 per cent is feasible at all. In fact, it bluntly states that the “achievement of the plan target is only possible if GDP growth rate in the last two years averages 11 per cent a year”. Given the ground realities of our economic growth under the structural reform process in our home market and the uninspiring state of affairs of the world market, something around 6-7 per cent GDP growth is all that can be hoped for.

The state of affairs in agriculture is even more dismal. The Tenth Plan targeted the growth of agricultural GDP at 4 per cent. But not only has it failed to check the declaration of agricultural growth from 3.2 per cent in 1980-1996 to 2.6 in the period of 1996-2002, it has in fact got worse. As the document states: “The average GDP growth in the first two years of the plan was 1.8 per cent and it is unlikely to exceed 1.5 per cent in the current year”. Correctly, the document sees the need to “focus on corrective policies needed in this area”. But is it aware that what needs correction is the unadulterated drive of the NDA government along the path of liberalisation, privatisation and globalisation that went as far as setting up a ministry to disinvest profit making PSUs and handing over Rs 10,000 crore to the US multinational Enron whose fraudulent activities were a scandal in the international market?

This is obviously not the case if the manner in which the deputy chairman of the Planning Commission first sought to integrate minions of the World Bank and IMF into the deliberating bodies of the Planning Commission and then the central government dissolved these rather than see them excluded when a number of the country’s leading economists protested at this sell-out of our sovereignty to men of international bodies owing allegiance to the USA and other imperialist powers. The document, however, speaks for itself.

In words at least, the document admits that some of the premises have gone horribly wrong. The theory that there should be less government intervention seems to have suffered a setback and the document admits that private investment refuses to fill the gap left by the retreat of government investment demanded by the World Bank theorists, and notes that what is required now is “a sustained demand impetus from public expenditures, even if it required some relaxation of fiscal discipline.” The curious thing is that this being asked for not to alleviate the burdens that so-called structural adjustment heaped on the mass of the productive people; but to make the climate more “investor friendly”.

While the document admits that “growth performance has been the worst in agriculture” and speaks of giving “special emphasis to promoting public investment in rural areas based on the possibility for absorbing unemployed labour for asset creation.” But the thousands of suicides of farmers and the rural poor are not even mentioned. So, obviously farmers are not the investors the document hopes to be friendly to.

FLAWED ANALYSIS

What is worse, they are likely to be squeezed even further of their assets if this document is anything to go by. For example, it notes that existing water sources and ground water reserves seem to be depleting, but puts the blame on farmers using too much water, which, according to the document, has become “worse by the fact that cheap power encourages farmers to use excessive water.” But there is no word of soft-drinks companies drying up the water resources of whole areas to sell soft drinks that studies have shown to be injurious to health.

So, while the document speaks disparagingly of “effective community participation” in water-management, speaking of “traditional water harvesting structures” as “virtually defunct,” it proposes the “assignment of water rights” (read: handing over water to the multinationals) to “successfully implementing decentralised irrigation systems,” while the state irrigation departments are expected to take a backseat and watch the multinationals take over the benefits the infrastructure generations of water experts from Arthur Cotton to Dr K L  Rao have laid to alleviate the lot of farmers. Such an approach to the question of irrigation and water will be fought against as it already has been in states like Maharashtra and Kerala already.

On the question of the essential commodities Act and the PDS, which have prevented famine conditions being manufactured by grain wholesalers and exporters, the document states that the act was identified as “a major impediment to the development of modern markets” and that “it should be replaced by a suitable provision which could deal with emergency situations without hampering normal market activity.” Moreover, it notes that while the NCMP (Common Minimum Programme) states that “the Essential Commodities Act will not be diluted, but it is necessary to examine this issue in depth so that changes which are necessary in the interest of accelerating growth of farm incomes can be made.”

This declaration of the interest of the farmer and not that of the wholesaler and multinational agro-business is spurious. For a couple of paras on, the document attacks “The price support and procurement systems, combined with input subsides on fertiliser, electric power and canal water,” which it admits  “have been the main pillars of domestic support for agriculture” as responsible for “a sharp increase in subsidy based support while public investment in agriculture has suffered.” Not only is the contention of ‘a sharp increase in subsidy based support’ patently false especially as Indian subsides affect hundreds of millions of people and the amount spent per individual is negligible and is far less than the subsides paid to farmers in USA, Japan and the E U; but the cut back in public investment had nothing to do with the subsidy regime. It is a theoretical premise of the World Bank/IMF prescription for development. That the two have been clubbed together in this document reflects its fundamental dishonesty. What it really aims at destroying is the laws protecting the subsistence of our rural masses, like the “rigid rules” framed by the states under the ECA and the “multiple food safety laws, which hamper the development of a modern food processing industry.” And its real purpose is to “allow co-operatives and private parties to set up modern markets.”

The word ‘modern’ has been used to dishonestly cover up the aims of a corporate control over the mass of Indian people, nearly half of whom are under poverty line. Even the laws can hardly protect them from adulterators, sellers of spurious products purveyors of banned drugs and sub-standard products as the recent controversy over soft drinks has shown. Less restrictive practices would seriously endanger the health and survival of our people on a mass scale which would leave the disasters of sub-Saharan Africa far behind.

DILUTING PRO-PEOPLE SCHEMES

On the question of food security too, the document sees the need for schemes like The TPDS, Antodaya Anna Yojana, Mid-day Meal Scheme, the Integrated Child Development Scheme, and the Food for Work Scheme to be “rationalised.” And we know that rationalization means merely cutting down the scope of these schemes. With regard to the Tenth Plan targets for social justice for scheduled Castes and Tribes, the document, while noting that these targets fall short of the Millennium Development Goals, is satisfied with stating merely that these targets are not likely to be met. It is merely satisfied with ‘monitoring’ them. The question of education too, is similarly treated. The document brazenly declares that “since elementary education has been declared a Fundamental Right, there is always the possibility of the Courts intervening, which could prove disruptive.” So, the programme is to be implemented in letter rather than in spirit to forestall such an eventuality!

On the question of land distribution and forest development by the tribal people, the document notes disparagingly that the plan proposals to bring waste and degraded lands into production and encouraging diversification to more labour intensive crops had not progressed very much and calls for “a review to be made of the approach.” Its greater concern is that there are too many “land use restrictions.” Moreover, it sees a major hurdle in the fact that local communities will not be involved “unless land ownership is given to them. “But it does not propose this. Its eye lights only on lands held by the PSUs and not by the landlords as constituting a hurdle to transforming India’s rural economy.

Even the Employment Guarantee Scheme presently being touted by the central government receives cold treatment. We are told its likely cost is to be between Rs 21000 and Rs 40,000 crore, “which could be shared between the Centre and the states.” And then it goes on to state that the feasibility of embarking on such a venture depends on “the overall resources picture and demands of other sectors” and “the feasibility of increasing the employment content of investment expenditure especially in rural areas.” Clearly then, from the perspective of the Planning Commission, this touted Bill is merely to serve as an eyewash to cover up for the discredited economic policies it is determined to pursue regardless of the ruin they have brought to large sectors of our economy.

It is all praise for the Electricity Act of 2003 and criticizes the “populism” of state governments that prevent its application. Obviously the experience of Enron means nothing to it. The call for foreign Direct Investment is loud clear as is that for a change in existing labour laws. Obviously foreign multinationals will be allowed to exploit the Indian people without let or hindrance of our existing laws. How this will improve the condition of an already wretched people selling their children to child-traffickers, committing suicide, and working under miserable conditions that do not even get them two proper meals in day, is anyone’s guess. It is heartening that the subservience of the Planning Commission to the World Bank and IMF has been challenged by our economists. The people must challenge its policies and force them to be turned to their advantage, with elements of the CMP as a guideline. There is no other alternative to this.