People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


Vol. XXXIII

No. 21

May 31, 2009

 


EDITORIAL

Brace For Bigger Struggles

 

AS we go to press, the second edition of the UPA government is yet to constitute its full cabinet of ministers. Reports suggest that this will take place on Thursday (May 28, 2009), nearly a fortnight after the results have been declared.  In 2004, this had taken only ten days and hours after the swearing-in, portfolios had been announced.  13 of the 19 cabinet ministers sworn-in alongwith the prime minister, last week, are still waiting for their portfolios.  If such uncertainties also define the policy direction of the government, then there is very little hope for the relief that people expect in the midst of mounting day-to-day burdens.

 

At the meeting of the Congress parliamentary party, where he was elected to be the prime minister once again, Dr Manmohan Singh said that this victory comes with the “challenge of rising expectations”.  He described the people's mandate as a verdict for “inclusive growth”, “equitable development” and “a secular and plural India”. If these have to be achieved, then many a decisive policy measure would have to be translated into action. The growing hiatus between the “shining” and “suffering” India is getting aggravated by the devastating impact of the global economic recession.  The UPA government continues to be in a state of denial on this issue. As the statistics for key economic fundamentals for the first quarter of 2009 appear, it is seen that India's industrial output dropped to an alarming minus 2.3 per cent growth in March compared to the corresponding period last year. 

 

The manufacturing sector, which provides a large quantum of employment and which has a nearly 80 per cent weightage in the index of industrial production, saw its growth rate falling to a whopping minus 3.3 per cent.  The negative impact of the global recession on international trade has been intensifying. India's exports have declined for the seventh consecutive month – a fall of 33 per cent.  Imports, particularly capital goods imports, which contribute significantly to infrastructure development, have contracted by 35 per cent. 

 

All this means is that the existing levels of employment and its future potential are set to decline significantly. This will only further widen the hiatus between the “shining” and “suffering” India, pushing many more millions into levels of extreme poverty.  The only way this situation could be dealt with and some relief provided to the people  is by sharply increasing public investments to generate both employment and domestic demand that can stimulate growth.

 

Instead of taking this only course available, India Inc., serving as euphoric 'cheer leaders' are hailing the appointment of Pranab Mukherjee as the finance minister and egging him to proceed on an unbridled course  of neo-liberal economic and financial sector reforms. Gleeful at the fact that the UPA government now does not require the support of the Left, India Inc. is asking this government for large-scale disinvestment of the public sector and to immediately legislate on financial sector reforms, which the Left had prevented the last government from doing so, like the privatisation of pension funds, allowing greater equity for foreign investment in insurance sector as well as to allow the foreign banks to virtually takeover Indian private banks.  Needless to say, very soon cries for full convertibility of the Indian rupee will also be raised.

 

India Inc. simply cannot accept the reality that unbriddled financial sector reforms,  in the first place, have laid the foundations for such a gigantic economic collapse and meltdown leading to a global capitalist recession. The World Bank has estimated that 2009 would be the “first decline in world output on record”.   India Inc. also cannot simply accept the fact that the pro-people policies pushed by the Left with the last UPA government and those reforms that it stalled, ironically, contributed significantly for this victory of the UPA.

 

India Inc. seems to be learning nothing from the experience of the bankruptcy of the  ‘gang of five’ financial high priests of the Wall Street.  Even the US president Obama is talking of policies aimed at the common street as opposed to the Wall Street! 

 

Of course, what course the government would take would only be known in the President's Address to the joint session of the parliament  on June 4.  The finance minister has announced that a full-fledged budget would be presented and adopted before the end of July.  This is constitutionally required  as the      ‘vote on account’ approved by the parliament expires on July 31.  If this is not done, then a fresh vote on account, highly inadvisable, would have to be taken. 

 

As pointed out in these columns last week, this UPA government has not presented the country with a Common Minimum Programme. In its absence, we shall have to wait for the declaration of their policy direction, not only for the economy but in all other spheres of social policy as well. 

 

Whatever be the content of such a policy approach, it is clear that the much-required relief for the people and an improvement in their standards of livelihood can only come about through the pressures of popular and sustained people's movements and struggles. Such struggles will also have to be waged for the protection and further strengthening of the secular democratic foundations of modern India and to protect its economic and political sovereignty by pursuing an independent foreign policy. We are committed to protect and further improve the conditions of livelihood of our people and strengthen the foundations of the modern Indian republic and call upon the people to brace themselves for bigger struggles in the future.