(Weekly Organ of the Communist Party of India (Marxist)
February 27, 2011
Heed the Warning
AS we go to press, the Indian working class, in unprecedented number of lakhs, has thronged the country’s capital. In a disciplined manner, lakhs of workers marched to the parliament on a five-point charter of demands. These have been reported in these columns in the past. However, to recapitulate in brief : 1 Curb price rise, strengthen PDS; 2 Strict enforcement of labour laws; 3 Stimulus packages to corporates must be linked to employment protection; 4 National fund for the unorganised sector to provide for social security to all; and 5 Stop privatisation/disinvestment of public sector to meet budgetary deficit.
This UPA government, with its anti-labour policies, has achieved the impossible. It has united all the central trade unions and all independent federations in the country in this struggle. Such unity would not have been conceivable a few years ago. Preparations for this united struggle began with a National Joint Convention in September 2009. This was followed by a countrywide `jail bharo’ programme in February 2010 and the historic all-India strike on September 7, 2010. This march to parliament was a follow-up to these actions. The sea of Red Flags and lakhs of workers belonging to the Left trade unions were joined by the Congress affiliated INTUC and others while the BMS was party to the convention and in drawing up the charter of demands.
This `real’ India marched to the parliament on the eve of the presentation of the 2011-12 budget. They voiced their strong opposition to the trajectory of neo-liberal economic reforms that this UPA government is following. If the UPA government does not heed this voice of the working people (it is widely anticipated that it will not), then surely it will have to face more united and mightier struggles in the future. These struggles will be joined by all working sections of our people demanding a radical shift in the policy orientation of the government.
The neo-liberal pundits are patting their own backs with satisfaction claiming to have weathered the storm of the global recession. India’s `growth story’ is, however, bypassing the bulk of our people. As noted earlier in these columns, the number of dollar billionaires had doubled from 26 to 52 last year whose combined asset value is equal to 25 per cent of our GDP. The latest data now available show that this number has risen to 69 during the course of this year. India, indeed, is shining for a small proportion of our people. On the other hand, distress suicides by our farmers continue. Worse is that they are now being joined by many others like victims of microfinance exploitation or those who are denied their legitimate wages under the Rural Employment Guarantee. To the vast majority of the Indian people, the price rise continues to impose unprecedented additional burdens.
The neo-liberal strategy revolves around providing stimulus through tax concessions in order to promote growth. This is similar to the global neo-liberal prescription of bailing out financial giants and corporates who, in the first place, caused the present global crisis. The consequence has been that corporate insolvencies have been converted into sovereign insolvencies because the governments of these countries had heavily borrowed to finance these bailout packages. In many of these countries, working class benefits and rights are being mercilessly attacked in order to finance this borrowing. This, in turn, means that governmental expenditures are drastically reduced, if not abolished, in the social sector imposing unprecedented burdens on the people.
There are similar noises that can be heard in the corridors of power in India. There are strong pressures by those very sections of the ruling classes who have benefited from the stimulus packages (adding themselves to the list of billionaires) to ensure that the forthcoming budget emphasises `fiscal consolidation’. In other words, the pressure is on the government to reduce its expenditures in the social sector and to reduce, if not abolish, subsidies to the needy. This will only add to the current burdens that are mounted on our working people.
A radical shift in the policy direction means moving away from such a trajectory. This is perfectly possible. Even at the expense of repetition, consider the following:
In last year's budget papers there is a Statement of Revenue Foregone. This informs us that Rs 4,14,099 crores was the tax revenue foregone in 2008-2009. In 2009-2010 this stood at Rs 5,02,299 crores. This whopping amount was foregone by the government because it has doled out tax concessions to the tune of 79.54 per cent of the revenue that should have been collected. Conceding, for a moment, tax concessions in excise and customs duties would have served as a stimulus to fight the impact of the global recession, the concessions given to corporate and high end personal income tax payers amounted to Rs 1,04,471 crores in 2008-2009 and Rs 1,20,483 crores in 2009-2010. Nearly Rs 2.25 lakh crores of legitimate revenue was forsaken. Instead, if these resources were collected and used for public investments, this would have built our much needed infrastructure while generating substantial employment improving people's livelihood. The consequent growth of domestic demand would have laid the foundations for better economic fundamentals for a sustainable growth trajectory. Will this budget effect such a shift in policy direction?
There is a major concern in the official circles that inflow of the foreign capital has sharply declined by 31 per cent last year. Eager to appease international finance capital, hence pre-occupied with the need to reverse this trend (which has nothing to do with our economic fundamentals but is due to the global recession) this budget may well give further concessions to foreign capital, like rising its cap in the insurance sector, banking reforms, privatisation of the pension funds etc. Such financial liberalisation will only make India more vulnerable to global speculative activity. It is precisely because the Left had prevented UPA I from undertaking such reforms that India, to a large extent, could resist the disastrous impact of the global recession. This resilience will be gravely weakened, if such measures are undertaken.
Popular pressures must, therefore, be intensified in the future through mightier struggles to ensure that the government is forced to undertake a radical shift in the policy direction. It must be stopped from undertaking further financial liberalisation reforms which would be disastrous and impose still greater burdens and miseries on the working people.
While expressing solidarity with the Indian working class, we can only say `forward to mightier struggles’.
(February 23, 2011)