SHRI G.K. VASAN (CONTD.): Overall, I would say that the population of about 100 lakh belonging to Barak Valley Area of Assam and its neighbouring States is likely to be benefited by the development of the National Waterway. It will also provide an alternative mode of connectivity to the North-East India from the mainland which is very important. This so far has been only dependent on land routes through narrow chicken neck at Siliguri.
Sir, in today’s short discussion, I am happy that hon. Members have made very valuable suggestions while contributing to the discussion on the development of this Waterway and the National Waterways in general. I would now try to attempt to answer one or two important queries made by the hon. Members.
The hon. Member, Mr. Kalita, and another hon. Member from the BJP were very specific on security. Yes, Sir, we are very concerned about its security. Safety will be given the first priority. And I will see to it that all security measures are monitored and adhered to. The hon. Member mentioned about the river port on which we spent Rs.40 crore. I will take it up in such a way that it will be of full use, especially keeping in mind the time limit.
Respected Member Shri Bandyopadhyay talked about the protocol routes with Bangladesh under which inland vessels of one country can transit through the specified routes of the other country. There are five existing protocol routes which connect Bengal and Assam. All the routes are viable today.
Shri V.P. Singh Badnore also gave a very useful suggestion. This Bill, I would say, was introduced in the House in March. Therefore, there is no question of its copies not being made available.
About the consensus for development and of the rights which he mentioned, I am sure, Sir, the Ministers of Water Resources and Agriculture will take care of that. I will also coordinate with them on this important issue.
Respected Najmaji was kind enough to give her suggestion. She told about the history of rivers which I clearly noted down. I would kindly like to mention here that there are already five declared National Waterways. This is the sixth Waterway. We have been trying to fully develop the first, the second and the third one. We are trying to develop the fourth and the fifth. We are short of funds. But still we are trying to do it in a proper way. And the sixth one would also be developed and the time limit prescribed by the Parliament would be adhered to.
Sir, to conclude, I would like to say that we have declared National Waterways which, put together, stretch to more than 4,300 km. The Government of India, the Ministry of Shipping, I would say, is committed to develop all the National Waterways, which have been declared by the Parliament, and to put them for use for the economic development of the country.
The National Waterway Bill, which is being considered for passing today, would be executed in two phases. Phase I would take about three years and Phase II would take another two years.
From the Ministry of Finance, we propose to complete the execution within a timeframe of five years, so that it would definitely be of help to the people of the North-Eastern Region, particularly Assam and its neighbouring States.
I have taken note of all the suggestions of the hon. Members and tried to answer their queries. I assure the august House that I would take their inputs for further development of the Waterways and request them to extend their support for passing this important Bill.
MR. DEPUTY CHAIRMAN: The question is:
That the Bill to provide for the declaration of the Lakhipur-
Bhanga Stretch of the Barak River to be a national waterway
and also to provide for the regulation and development of
the said Stretch of that river for the purposes of shipping and
therewith or incidental thereto, be taken into consideration.
The motion was adopted.
MR. DEPUTY CHAIRMAN: We shall now take up clause-by-clause consideration of the Bill.
Clauses 2 and 3 and the Schedule were added to the Bill.
Clause 1, the Enacting Formula and the Title were added to the Bill. SHRI G.K. VASAN: I move:
That the Bill be passed.
The question was put and the motion was adopted.
(Followed by VKK/1X)
-YSR/VKK-SCH/1x/12.45 SHORT DURATION DISCUSSION ON
ECONOMIC SITUATION IN THE COUNTRY
MR. DEPUTY CHAIRMAN: Now, we will take up Short Duration Discussion. I would like to remind the Members that there is a decision that the discussion should conclude before 5 p.m., tomorrow being the Independence Day. Four hours are allotted. So, each Party is requested to adhere to its time. Otherwise, we may not be able to complete this today and we may not be able to hear the reply from the Minister. Now, Shri Ravi Shankar Prasad to initiate the discussion.
SHRI RAVI SHANKAR PRASAD (BIHAR):Sir, I am extremely grateful that you have given me the opportunity to initiate the debate on the current state of Indian economy. This indeed is a very relevant issue which agitates the entire country. When I am initiating this debate today, hon. Deputy Chairman, Sir, I see that onion is causing tears once again, not the peels of onion but the price of onion. I am told that it is Rs.75-80. Mr. Deputy Chairman, Sir, this morning I received a very good message which I think I must share with the House. In India, we are today in a situation when the price of a need, onion, the price of a convenience, petrol, and the price of a luxury, beer, all are the same. Price of onion, petrol and beer is between Rs.75 and 80. That is exactly the state of our economy. Therefore, I am beginning my observations with the state of inflation itself because for poor people, inflation is central to economy. In 2009, when hon. Finance Minister’s Government came back to power, there was repeated past declaration of containing inflation in 100 days. Then, the period became a little flexible. We were told 180 days and thereafter, the entire period declaration was stopped because the Government of the day did not know how to control inflation. We have debated that issue so many times in both the Houses. What is the position again today? The Consumer Price Index was 9.9 in June, 2013. It was 9.3 in May, 2013. When we come to the food economy, cereal is 17.6, vegetable is 14.6 and, eggs, meats and milk is 12.7. Inflation adds to the cost and makes life difficult. Even people of middle class today are feeling the pinch of inflation. Let me ask a very straight question: Why is your Government not able to stop price rise? Daily, the Agriculture Minister claims that we have got abundance of crop, everything is full, the foodgrains are rotting outside in open rain, etc. If there is abundance, why is there price rise? Obviously, there is gross mismanagement of food economy in the country. I remember, when Atal Bihari Vajpayee-led NDA Government came to power in 1998, the inflation was 8.26 per cent. When we demitted office in 2004, it was 2.83 per cent. In spite of a big drought and in spite of sanctions post-Pokharan-2 explosion, if the NDA could control the price for six years, why is a Government led by an eminent economist Prime Minister, Dr. Manmohan Singh, not able to control the price? Now, it is more than five years. Sir, we have the highest regard for the office of the Prime Minister. We have the highest regard for Dr. Manmohan Singh as an economist. But, economy grows only when the management of the country is led by the leader who wields authority. And, one of the problems which India is facing in the last so many years leading to the current situation is that, maybe, the Prime Minister is in office but not in authority. We have heard the issue of policy paralysis. We have heard the issue of decisions not being taken. I will come to that separately.
(Contd. by KR/1y) KR/VNK/1Y/12.50
SHRI RAVI SHANKAR PRASAD (CONTD.): Sir, we are told that Dr. Manmohan Singh took care of the economy in the year 1991. We know that. He was the then Finance Minister. I do not know why the real person who was behind, late Narasimha Rao's name was never taken. Maybe, it is sin to take the name of that man who was at the helm of affairs. Some faces in the Ministry of Finance have been quite well known -- Dr. Manmohan Singh, Mr. Montek Singh Ahluwalia, Mr. Chidambaram is Mr. Chidambaram, he has been a part of that. An eminent leader once commented in great fun, he talked a lot about the Sangh Parivar. We are proud of the Sangh Parivar. But there has been a Singh Parivar which has been working in the Finance Ministry for a long time. It is good that one of the eminent members got disillusioned and he is now sitting in the Opposition because he may have to raise a lot of questions to himself.
Sir, today what is the problem with our economy? Let me go straightway point by point. A good economy can never come unless there is good politics. What is the bridge between good economy and good politics? It is good governance. If there is no good governance, the economy suffers. Let me give four specific instances. Regardless of the debate on the FDI there is one issue on which there is no debate. There must be infrastructure development. Now, kindly see the position. Sixty-eight per cent of India's power need is thermal-based. We have got enough coal. What has happened? There came a coal scam, allotment, the Supreme Court's intervention, national outcry, everything is now in limbo. The NDA Government came with a far reaching law, the Electricity Act, 2003 wherein generation of power was delicensed. We demitted office. Today, the power situation is grim.
See the point number two, roads and National Highways. No dispute. There must be roads and there must be National Highways. We are very proud that under the NDA regime we did so much. Good, you ought to have carried on. We made from 11 KMs to 15 KMs. A loud declaration was made by you from there, now you are in the Chair, that we will make it 20 KMs every day. Good luck. Today, it is reduced to 2-3 KMs. There is corruption in the National Highways. There is problem of contractors; and their bills are not being cleared. Every thing is in limbo.
The third issue is about the real estates. Again a great sector of promise and growth, steel, cement, labour and everything, what has happened? Land use became a problem. Our trade deficiency has become a problem. Abuse of authority became a problem. Crony capitalism became a problem. Some persons who were politically protected were sought to be given all the help because of the abuse of authority; and it has a cascading effect. Today, the real estate sector has come into a serious problem.
The fourth is the telecommunication. We did extraordinarily well. We are very proud of that. Shri Vajpayee said that the price of mobile phone must come down. Along with my colleague, Mr. Arun Jaitely, I had the privilege to be a member of the Group of Ministers. We had completely eased the whole sector. Later on what has happened? There happened 2G Spectrum scam, problem in licence, corruption, crony capitalism, the Supreme Court's intervention. Today, the telecommunication sector has also come under serious cloud. Therefore, good politics is important for good economics; and the bridge is good governance. Because good governance became a casualty in the area of 2G Spectrum in telecommunication, in road construction, in coal allocations, in real estate we have seen these big sectors of growth have come under serious cloud.
(Continued by 1Z/RG)
SHRI RAVI SHANKAR PRASAD (contd.): Sir, I would like to raise an important question. Today, India’s growth is under serious cloud. It may even go down to five per cent. Why is it that people are not investing in India? On the one hand, when serious questions are being raised about the nature of growth which the Congress-led UPA has ushered in, on the other hand, there are State Governments after State Governments, mostly led by the BJP, which are posing ten per cent plus growth rate, be it Gujarat, Chhattisgarh, Madhya Pradesh or Goa. There may be other States as well; I have no quarrel with that. But this is very important that when there is so much of uncertainty and ambiguity, lack of trust, lack of credibility as far as the management of India’s economy is concerned, States after States are growing. But the difference is one. There is palpable good governance. There, decisions are transparent and quick and there is facilitation. Here, there is lack of good governance and there is problem everywhere. That is the real reason for this critical state of our economy. Yes; my friends from the ruling party blame everyone. They blame the CAG. Now they have started blaming the Supreme Court. We are the constant whipping boys. The media is always attacked of creating an atmosphere of gloom. But I would have really appreciated if the Government had looked within and realized that the state of economy was because of them. And I regret to say that the critical state of Indian economy is because of them and not because of other factors. That inward introspection is never there.
Sir, let me come straight to questions. What is important for an economy? Firstly, there must be a productive investment. Surely, investments must come in. Secondly, there must be adequate savings. People must learn to save, and they must get profits. They must save which can, again, be invested. There must be fiscal prudence, namely, that inflation is under check, that there is a stable currency and robust external factor, and most importantly, that there is confidence among investors. The investors must be willing to trust you and believe, “Here is the regime which facilitates; here is the regime which gives us open support and here is the regime where there is transparency as far as policy and implementation are concerned. About confidence of banks, I will talk about that separately. Now, whether it is a question of transparent policy regime, productive investment, adequate savings, fiscal prudence, robust external factor and stable currency, on all these factors, hon. Finance Minister, I am sorry, there is criminal mismanagement by your Government. And I will, briefly, touch all of them. Let me give you some very relevant statistics. When we demitted office, in 2003-04, the growth rate on GDP was 8.1 per cent. In 2012-13, it was 5.3 per cent, and surely, it is going to go down. The gross fiscal deficit to GDP was 4.5 per cent. Today it is 5.2 per cent. It was 5.9 per cent in 2011-12. I am giving all RBI figures, which I have collected. As regards current account deficit, which is the most vulnerable area, the NDA regime left office on a current account surplus of +2.3 per cent. Today, it is -4.5 per cent. Therefore, the current account surplus economy, which the NDA regime left behind, has become, today,
-4.5 per cent which is the current account deficit. Then, external debt was 112.7 billion dollars when we demitted office. Today it is 360 billion dollars. Short-term external debt was 3.9 billion dollars. Today it is 24.8 billion dollars. As for foreign exchange reserves, as cover for imports, during the regime of our Government, it was 17 months. Today it is seven months. This is the critical state of their economy. And what is the trade deficit? When we left office, in 2003-04, it was -13.7 billion dollars. Today it is -188 billion dollars.
(Continued by NBR/2A)
SHRI RAVI SHANKAR PRASAD (CONTD.): I would like to ask the hon. Finance Minister a point. He has been a very experienced Finance Minister. He is there in office for the last so many years. What has happened is this. The Finance Ministry and Shri Chidambaram have almost become synonymous. If it was Mr. Deve Gowda's Government, Mr. Chidambaram was there. If it was Mr. Gujral's Government, Mr. Chidambaram was there. When the dream team of Singh-pariwar of 1991 was there, Mr. Chidambaram was there, probably, in the Department of Commerce, if I am not mistaken. Now, when the UPA comes, he is a fixture from 2004. Mr. Chidambaram, kindly ask a simple question to yourself and satisfy us. Why you cannot measure up to the expectation which you could show even in 1996-97 when we had the most critical state of coalition politics. There is something seriously missing. Maybe, the Government is not in a position to do anything. Or, maybe, the left hand proposes something and the right hand disposes something.
Let me come to the issue of sliding rupee. It is a matter of very, very serious concern. I hardly need to emphasize that it is a direct byproduct of the Current Account deficit and the way the economy has been managed. Now the RBI has tightened liquidity. It has its own problems for further development and making life more difficult for private sector. But, in the Standing Committee of Finance, we had an occasion to examine the situation of state of economy. And, at times, the Ministry of Finance, when it appears before the Standing Committee of Parliament, is constrained to speak the truth. We had asked this question and there was a reply from the Department of Economic Affairs, Ministry of Finance. It is a part of the Report of the Standing Committee on Finance on the State of Economy. We did it last year. On likely reasons for rupee depreciation, it says that sharp decline in rupee, among others, indicate supply-demand imbalance in the domestic foreign exchange and market as there has been a slowdown in the FII inflows. And then, one point is important. Apart from global factors, there are several domestic factors which have added to the weakening trend of rupee which include increase in the Current Account deficit, high inflation and declining capital inflow because of weak growth prospects. Therefore, even the Ministry of Finance was constrained to concede before the Standing Committee, hon. Finance Minister, that there is a weak growth prospect. Why is this weak growth prospect? I know FDI has become an issue with this Government. I will come to that a little later. I have to address a lot on that. But, I think, a man of your sterling experience would know, surely, that FII is hot money. It comes and goes. FDI is stable money invested in infrastructure or investment in developmental activities. Now, hot money like FII comes quickly and goes quickly. They want to earn certain interest. They want to get good returns. And, if they find that growth prospects are not comfortable, they withdraw. What has happened is: Once they realized that the story of India is over and there is lack of trust, there is lack of credibility, they started going back quickly and quickly.
I was just going through a Report, hon. Finance Minister. It is a very latest Report, may be one year old. It is June, 2012 Report. It is titled "Ease of Doing Business Rank." It is a World Bank Report. It indicates how comfortable to do business in various countries. Sir, India is ranked at 132. Pakistan is much above us. It is ranked at 107; Sri Lanka ranks much, much above us all. It is at 81. Why is it that investors, not only in India but even outside, are having a problem in having the trust in your ability and credibility to deliver?
(CONTD. BY KGG/2B)
SHRI RAVI SHANKAR PRASAD (contd.): I come to that question again, hon. Finance Minister. If Indians are not willing to invest in India, why will the foreigners come here?
Last year, you announced FDI in retail; we had our problems; we had opposed it. It was completely ignored. You have got that right in Parliament, I can never say that. But, you have not been able to get even 25 naya paisa in FDI in retail. I will be happy to be proved wrong. But, not even a single penny has come. You are constrained to lift the two embargos, namely, 10 lakh-plus urban centres and 30 per cent local outsourcing. Even thereafter, people are not trusting.
A couple of months ago I had an occasion to go to Mumbai to address an international investors' conference. Mostly they invite all of you; but, occasionally they invite Mr. Jaitley and me also. It was my turn to address them in Mumbai. I asked them a very frank question: How are you taking India? Hon. Finance Minister, they said very frankly, "We have closed the file. We are waiting for elections." It was the very honest answer. I must tell you that I am opposed to your politics. But, as an Indian, I want my country to grow. That is what the legacy the NDA had left where Arunji, myself and others had the privilege to work. If this is the impression of India, it is a sad day for India. That saddened me enormously, Sir.
Now, I talk about productive investment. It needs three things--quick clearance of all the requirements, absence of policy paralysis and transparent regime. How many projects have been locked up by the Ministry of Environment and Forestry? I am all for environmental clearance. But, is it important that you have to sit with the Prime Minister to request the hon. Environment Minister to quicken the pace of approvals? If it is not required, reject it; if it is possible, do it. But, no action is taken. I was just going through some of the statistics. I was amazed to find that the Empowered Group of Ministers which was supposed to monitor delayed approval of schemes, the Ministry of Statistics and Programme Implementation's Report of May 2012 says that out of 564 projects of Rs.150 crores and above, only three are ahead of schedule, 133 are on schedule, 251 are delayed and the delayed cost overrun is 19.5 per cent. Now, this is happening.
Kindly see the index of national production. What is the position today? I have the latest figure of June, 2013 and it is a contraction, a growth of -2.2 per cent. We are in the negative growth. Hon. the Leader of the Opposition has always raised this issue saying that the level of capital goods production is an important barometer of the extent of industrial development. What is that? The capital goods production is contracted and had a growth of -6.6 per cent. Indians are not investing in India; foreigners are not investing in India; the industrial production has come to this scenario. Mr. Finance Minister, the private sector is not investing in India.
Now, let me come to the public investment. There is no public investment at all, Sir. I would like to know whether any major investments have been made. I was going through your Budget Speech of the last year. To bring down the fiscal deficit from 5.2 per cent, Mr. Finance Minister, you have cut the Plan expenditure by Rs.92,000 crores! Is it right? The situation has become so compelling that you were compelled to reduce Plan expenditure by Rs.92,000 crores. I don't know if private investment is coming. If public investment is not coming, if Indians are not investing, if foreigners have a problem, how would the growth story of India shine? That is, indeed, a very important issue which I would like to highlight.
What is the position of banks? I have been told, Mr. Finance Minister--I will be happy to be proved wrong--that Rs.7 lakh crores of projects, about Rs.5.5 lakh crores in roads and Rs.1.5 lakh crores in highways are locked up.
(Contd. By TDB/2C)
SHRI RAVI SHANKAR PRASAD (CONTD.): Is it a fact or not, I would like to be told. What is the position of banks? I was reading the statement of Shri Subbarao, the RBI Governor, which states, “In the last two years alone, the NPAs of top ten public sector banks have doubled from Rs.70,000 crores to Rs.1,40,000 crores.” The top national banks are having this much of NPA! How much of load can you take? There is a problem of current account deficit; there is a problem of fiscal deficit; the FDI is drying up; the FIIs are running away; this is the level of NPA of our own nationalized banks. Therefore, the entire state of the economy is in a very critical condition. I don’t know what magic wand you have. We would like to know that. If your magic wand could not operate for four-and-a-half years, hon. Finance Minister, how would it operate in the coming five-six months? We would like to be told very clearly and categorically.
Sir, I will raise two quick issues, namely, unemployment and poverty reduction. I know, yesterday, you have come up with some notifications, raising up duties here and there, some cosmetic changes are made. When 60 billion dollars worth gold have been imported, you have raised the duty. I don’t know whether it is going to impact the state of economy or not. But in my very considered view, they are window-dressing. They do not address the substance of the problem. But let me come to the whole unemployment issue. Today, Mr. Rudy was raising that question, in a very eloquent way, while he asked a supplementary, but the hon. Labour Minister could not even understand that question. Now, the NSSO data is on record. Between 2000-2003, 82 lakh employment and self-employment opportunities were created, on an average, each year. And only four lakh jobs were created during the UPA-I regime! Compare this with 12 million annually during the NDA regime. It is not my statistics; it is the statistics of the NSSO data. In fact, according to the NSSO data, the employment rate has actually declined in the five year period ended on 2009-10, to 39.2 per cent from 42 per cent in 2004-05. Therefore, manufacturing is down, industrial production is down, export-import is down, unemployment is down, only two things are up. The two things are: price and deficit, current and fiscal, both. This is the state of your economy! After all, we are very proud of our young population, but they are entitled to, at least, proper job opportunities. Mr. Minister, your Government has been talking about the aam aadmi’s concerns frequently. What is the condition of aam aadmi, whether it is price-rise, whether it is stable life, whether it is transparent regime, trust. Mr. Finance Minister, I have not been a Marxist. But one expression which has impressed me is ‘crony capitalism’. I don’t know whether Marx ever realized that his crony capitalism would become an important figure and feature in the politics of Congress and UPA. Whether it is 2G, whether it is Coalgate, whether it is Augusta Westland, whether it is Commonwealth scam, etc., crony capitalism has come to root. Why has it happened? I know you are a very experienced Finance Minister, and I know you have been a senior leader in the politics of the country. Why could not you all control it? Which were the forces giving so much of freedom to these crony capitalists to completely play havoc with the system? Let me give you one example, and that is very important. Regardless of the 2G problem, when the GoM headed by you put the 3G spectrum for auction, against the target of Rs.35,000 crores, the Government earned a profit of Rs.67,000 crores, and on the WLL, again, you earned Rs.30,000 crores. Therefore, one lakh crore rupees net profit was made in the year 2009-10, when the 2G was there, when you were fighting here. But when the Supreme Court asked that 122 licenses to be re-auctioned, suddenly, there was a ganging up, no; and your Ministers were saying, “Come on, see, no return is coming about!”