Skc-mcm/1A/11. 00 The House met at eleven of the clock, mr. Chairman in the Chair mr. Chairman


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SHRI RAVI SHANKAR PRASAD (CONTD.): I am putting a question. If in the same atmosphere of gloom, in the year 2010, the 3G spectrum can fetch you rupees one lakh crore, along with the WLL, why is it, after the Supreme Court judgement, that there was a conscious attempt to ensure that whole auction fails? Because, some lobby, somewhere, was ensuring that they have to have one-up-manship that what they said was right. If that kind of justification is given for crony capitalism, I am very sorry, hon. Finance Minister, the state of economy will never improve.

Sir, the last issue, which I would like to highlight, is the issue of poverty; of late, too much in debate. What is the poverty line? Regardless of our political divide, hon. the Finance Minister, we all work for the poor. In a democracy of the size and diversity of India, if a political party will not work for the poor, that party cannot survive, regardless of political or ideological divide. Now, what is the benchmark of poverty? We have the Tendulkar Committee; we have the Sengupta Committee; we have the Saxena Committee; we have the shameful audacious affidavit in the Supreme Court of India that if a man earns rupees thirty, per day, in a town, he is above the poverty line and if he earns rupees twenty-eight, per day, in a village, he is above the poverty line. Nothing could be more shameful than that. Then, we get a collusive report of the Planning Commission कि हिंदुस्तान में गरीबी कम हो गई है। Then I saw that there was a revulsion among all of us, across the board. Suddenly we found that even people within your party started questioning you. Even the Ministers said that the Planning Commission was wrong. And, you have got a very loquacious General-Secretary of your party, whose name I need not take. He has a problem with you in all the Ministries. When you were in the Home Ministry, he had a problem with you on extremism. He has a problem with you in the Finance Ministry. What kind of policy is this? You are not able to decide. In our Standing Committee, we are going to examine the whole benchmark that a State should also be considered as to how they do with this benchmark of 'below the poverty line' or 'above the poverty line'. You are coming with this Food Security Bill. We are going to discuss that. Here you are saying that गरीबी गिर गई है, वहां you are claiming that you would give it to 70 per cent of the people. Therefore, there is complete lack of clarity. This is what I am trying to highlight.

Hon. the Finance Minister, I have to make a very humble appeal to you. We can differ on policy. लेकिन मेरा आपसे एक विनम्र आग्रह है, मैं हिन्दी में बोल रहा हूं कि गरीबों के साथ उनकी गरीबी का मज़ाक करना हम बंद करें। I am translating it for you, let us all stop playing jokes with the plight and misery of the poor. Come on! We have been told that this is one point drop in the Wholesale Price Index. We don't take into account the Consumer Price Index. I think, we can go to footpaths of Delhi and we can know the plight of the people as to how much havoc the inflation is causing. The same is the poverty line. I would like to hear from you in your reply -- because the state of economy and the plight of poverty, both, are linked – what the final poverty benchmark of your Government is, as far as the benchmark of the poverty line is concerned. Do you agree with the assessment of the Planning Commission? Or, there is a lack of poverty. Because, the measurement of the Planning Commission is on the Tendulkar Committee's Report. And, there was an assurance in this House that you have set up the Rangarajan Commission, which is going to revisit the entire benchmark. If there was a commitment by the Government, how come, based upon old benchmark, which is very vulnerable and debatable, this whole figure has been arrived it. I would like to know it from you. There were very specific queries. How much foreign investment have you got, both in terms of the FDI and the FII? The second issue I would like to know is – I have got the figures, I will wait for your response – what percentage of Indian Constitution is constituted by the foreign resources, both, the FDI and the FII and what percentage of Indian economy is based upon domestic investment, that is, the Indian investment.

(Contd. by 2e – PK)


SHRI RAVI SHANKAR PRASAD (CONTD.): We would like to have this clarity, depending upon the size of the economy. I am sure when you give the reply, the reply would be very difficult. When you give the reply, it would present not a very happy picture. But I will await for your response. What is my concluding take, hon. Finance Minister? Sir, I am grateful that you gave me so much time. I am concluding in just five minutes. Whenever we talk of economy, you say, ‘external factors’. दुनिया में बहुत खराबी आ गयी है तो क्या करें? सर, अगर आपकी इजाज़त हो तो दुश्यंत कुमार जी का एक शेर पढ़ने की इच्छा होती है

कहां तो तय था चिरागा हरेक घर के लिए,

कहां चराग मयस्सर नहीं शहर के लिए।“

You had promised the Moon for the entire town, for all the residences in town, for all the households in town, but, today, even tim tim power is not available for the city itself, forget the houses. Hon. Finance Minister, with you your kind guidance, what I am trying to highlight is this. I can understand, maybe, because of certain foreign factors, some problems can come in some liquid areas. But how does foreign factors come to have a problem, as far as declining infrastructural development is concerned? How does the global factors come, as far as financial recklessness is concerned? How does the global factors come to have an intervention as far as corruption is concerned? I don’t think you can attribute them to any global factor at all. How does the foreign factors come to have a play as far as policy prowess is concerned? How does the foreign factors come to have a play as far as lack of trust, lack of credibility of decision-making is concerned? Those are domestic problems. Those are your own problems. These problems have not been addressed. I remember, the former Finance Minister’s statement – obviously, now he is the President of India, we have the highest regards for him – in this House. He quoted Shrimati Indira Gandhi, that our banking system has been so stable that it was unaffected by global scenario when the subprime crisis happened. At one point, you tom-tom your financial apparatus and when you have a problem, you say that everything is dependable on global factors. Mr. Deputy Chairman, Sir, हिन्दी में एक कहावत है, “मीठा-मीठा गड़प, कड़वा-कड़वा थूक।” यह तो नहीं चलेगा। You have to be honest about it. The reason is very simple. The reason is you have ill-treated India’s economy; the reason is you have shabbily treated the aam aadmi; the reason is you have ushered in an era of gross mismanagement of Indian economy; the reason is that there is lack of leadership, transparency, integrity and commitment as far as decision making is concerned. If that is the treatment you have given to the Indian economy, if that is the shabby treatment you have given to the people of India, I can only say that the people of India are waiting for the final treatment to be given to them whenever elections take place. That will be the final response. I am extremely grateful, Sir, for giving me this chance. Thank you.


MR. DEPUTY CHAIRMAN: Thank you. Now, Dr. Bhalchandra Mungekar; not present. Prof. S.P. Singh Baghel.

SHRI N.K. SINGH: Sir, I think, we should have lunch now. …(Interruptions)..

MR. DEPUTY CHAIRMAN: Yes, it was decided in the Leaders’ meeting that lunch would be from 1.30 p.m. to 2.00 p.m. ..(Interruptions)..

SHRI ANANDA BHASKAR RAPOLU: Sir, if Mungekarji is not available, our Mani Shankarji is there and myself is also available.

SHRI MANI SHANKAR AIYAR: Sir, if Mr. Mungekar is not present, should there not be another Congress speaker?

MR. DEPUTY CHAIRMAN: Yes, there can be. So, I will do one thing. You start. You speak for five minutes, then, I will adjourn for lunch. You can continue after lunch. You can just start now.

SHRI MANI SHANKAR AIYAR (NOMINATED): Mr. Deputy Chairman, Sir, I have listened with the utmost interest to the very eloquent and passionate speech that we have heard from the Chief Whip of the BJP....

SHRI RAVI SHANKAR PRASAD: I am the Deputy Leader of Opposition.

SHRI MANI SHANKAR AIYAR: ... Deputy Leader, God-incarnate, Mr. Ravi Shankar Prasad. I have listened to him with all his titles and all his glory. ..(Interruptions).. I want to congratulate him on the excellence of the facts and arguments that he has adduced.

(Contd. by PB/2F)


SHRI MANI SHANKAR AIYAR (CONTD.): But he also seems to be suffering from a case of amnesia because he talks of crony capitalism and doesn’t remember that it was when his Party was in power that we had the most extreme form of crony capitalism in the stock market scam; that was of such a serious nature that it had to be investigated by a JPC. So, crony capitalism is not an invention of the UPA nor, indeed, is it in Marx. I know you said, you are not a Marxist; but we have Comrade Rajeeve here, who will tell you that crony capitalism does not exist in Marx. What we do know is that very frequently, capitalism is accompanied, even as socialism is, by people who wish to take advantage of the ideology to pervert that ideology in the consequences of that ideology, and when this happens, you need a strong regulation. Now, the Deputy Leader of the Opposition was not present in the House when we discussed the Companies Bill only a few days ago, and, there, we have invented, we have discovered, we have presented, we have argued and we have set out a whole rash of measures aimed at controlling precisely this crony capitalism. So, I think, by pointing the finger to crony capitalism, you are pointing the right finger. But your finger doesn’t go far enough to indicate that what you have said is well accepted and, therefore, rectificatory steps are being taken. And, while it is true, as you said, that inflation is going up, I remember with considerable joy our being able to bring down the BJP Government in Delhi on the ground of onion prices. ...(Interruptions)... And, fortunately, our Government, with another four or five months to go for those elections, has already started taking steps to deal with a situation where onion prices appear to have gone up principally on account of hoarding, rather than because of any relative non-availability of the crop, and when these onion prices come crashing down, then it is that these elections are going to take place. ...(Interruptions)... So, if you think that you are going to inflict on us in 2013 what happened to you in 1998, then I fear that you are living in an illusion. Your last remark that the people of India are going to teach a lesson is well taken, but I don’t know whom they are going to teach a lesson to. When in 2004, with you as Minister in the other House and me in the Opposition, I predicted that the Congress would win, your guffaw was the loudest that we heard, and if you wait till May 2014, I assure you that my guffaw is going to be louder than yours. So, the attempt by the Opposition to shore up its own morale by suppressing the facts that need to be brought into the open and by propagating misinformation in the name of facts is just the kind of strategy that has repeatedly resulted in the Congress Party being the natural party of governance and the BJP being the natural party of Opposition!

MR. DEPUTY CHAIRMAN: Now, Mr. Mani, you can continue after lunch.

SHRI MANI SHANKAR AIYAR: Sir, I will be happy to continue substantively after lunch.

MR. DEPUTY CHAIRMAN: The House is adjourned up to 2.00 p.m.


The House then adjourned for lunch

at thirty minutes past one of the clock.


The House re-assembled after lunch

at two minutes past two of the clock,



MR. DEPUTY CHAIRMAN: Now, Mr. Mani Shankar Aiyar to continue.

SHRI MANI SHANKAR AIYAR: Mr. Deputy Chairman, Sir, although I do not have the privilege of belonging to the Singh parivaar, to which the Deputy Leader made a reference, despite my very best efforts to marry into the Singh parivaar, the fact of the matter is that notwithstanding this serious gap in my bio-data , I do believe that the performance of the Government led by Dr. Manmohan Singh, over the last nine years, and going on to ten now, has been quite a remarkable record; I would request you, to consider certain basic facts about our economy.

Sir, the annual average rate of growth of the Indian economy was raised in the decade of the 80s, first under Shrimati Indira Gandhi and after that, under Shri Rajiv Gandhi, to 5.9 per cent. Then, when the Government of Shri P.V. Narasimha Rao came in and he started this new phase of economic reforms, then, between 1991 and 1996, we succeeded in raising the rate of growth of our economy above that to over 7 per cent. Then, we went through a phase from 1996 to 2002, where a succession of non-Congress governments came in, caused havoc with our economy, caused our economy to rise in certain years and fall in other years and where the collapse in Indian agriculture took place. The net result was that if you compared the last decade of socialism, that is, 1980 to 1990, with the first decade of reforms, between 1992 to 2002, the annual average rate of growth of the economy, which had gone up to over seven per cent in the first half of that decade, thanks to the performance of our friends in the Opposition, was brought down to just 5.9 per cent.



SHRI MANI SHANKAR AIYAR (CONTD.): And, Sir, I want to give the credit where credit is due, in the year 2003-04, there was such a boom in the Indian economy that the Government of the day decided that they were doing so well that they would go in for an early election. But, fortunately, the people of India recognized what is a boom that has been promoted from elsewhere and what is a boom that has been promoted indigenously. So, although in their eyes 'India was shining', in the eyes of the people of India, 'India's shine' was entirely in the eyes of the NDA Government's leadership. In consequence of which, we came to power. We came to power in 2004 because the people of India did not trust the NDA Government to be able to consolidate the chance-increase in our GDP brought about by a global boom that was beginning in the year 2003. I call it the ‘Bernanke boom’ because it had a great deal to do with the US federal system, attempting to boost up the world economy. However, that may be, between 2004 and 2008, the performance of the Indian economy was such that it was believed that it was a matter of days before we would be able to breach the mental barrier of 10 per cent to take us into double digit growth when the economy collapsed, the world economy collapsed. Although the world economy collapsed, we did not, and that is something to be stressed, for if whatever little happened in the last year of the NDA was purely an accidental consequence of the global economy growing owing to the measures that have been put in place by the UPA-I Government, that high rate of growth was stabilized. And, for me to say that in the UPA-II that higher rate of growth has continued to be stabilized flies in the face of the figures that were presented to us by the Deputy Leader of the Opposition. Why do I still assert it? The fact of the matter is that when the global economy was doing outstandingly, there was only one large non-oil exporting country that was doing better than us and that was China. China, at its best, was about 2 per cent ahead of India in growth rate. And today when China is at its worst, India is still only 2 per cent behind the Chinese. And we are ahead of every other large economy in the world, except, perhaps, some of the oil exporting countries, of which Indonesia is the prime example. If you take our partners in BRICS, apart from China, whether it is Brazil or Russia, whether it is South Africa, whether it is other large developing countries in the world, we still remain well ahead of all of them. So, we are not suggesting that we are a kind of a leaf in the wind, and when the global economy rises, we rise, and, when it falls, we fall. We have so structured our economy in the process of globalizing it and liberalizing it that we still have got the instruments in our hand to, at least, contain the downward effects even as those instruments have enabled us to leverage the effects when things are going well in the global economy. I do not know how much opportunity the Deputy Leader of the Opposition has had in recent years. He has been fully employed and I have been totally unemployed. So, I have been going abroad a great deal. And wherever I go in the western world, I am met with amazement that when their economies are stagnating -- in fact, some of them are even declining -- and when they recover, they barely get above 1 per cent growth and that there should be an economy in the world that is not labelled China and is still growing at approximately 5 times the rate at which Western Europe is growing, at which the United States of America is growing. There is a Eurozone crisis that followed the housing crisis -- the unsecured mortgage crisis -- that had overtaken the US economy a little while earlier.

(Contd. by KSK/2j)

hk/lp -- KSK/AKG/2.10/2J

SHRI MANI SHANKAR AIYAR (CONTD.): And, notwithstanding the house of BRICS, that was falling all around us, we were the only BRICS country to survive and to flourish. The rate of growth, which is being criticised with some justice by the Opposition, is a rate of growth which we have sustained in the midst of a global crisis and which is substantively comparable to almost every year of non-Congress growth in India. Therefore, while it would be advisable to share with the hon. Finance Minister our suggestions as to how we could do better, this kind of mindless criticism that our economy has collapsed, when it has merely fallen, from astronomical levels to sky-high levels, is a misplaced criticism that does us no good. It is because there is a sense of responsibility in the constructive criticism of the Finance Minister that comes from within the Congress, to which Shri Ravi Shankar Prasad made a reference, and because the hon. Finance Minister’s reaction to such constructive criticism is constructive that through a dialogue between those who have the welfare of the country and the welfare of the party at heart, that we put in place those mechanisms that enable us not to collapse to either European levels or to American levels and to continue to perform better than any of our peers in the group of 77. This, I think, requires acknowledgement on their part. The figures with respect to this will, I dare say, be provided by the hon. Minister of Finance and so, instead of overburdening the House at the moment with the figures, the detailed figures, the micro figures, that will re-assure the country at large, and this House in particular, that we are still on an even keel, that there are problems that our economy is facing today, which it was not facing two or three years ago, that, nevertheless, matters are in hand and we don’t really need the Opposition to tell us that there are problems with our Current Account Deficit or to tell us that there are problems with regard to our current deficit and our fiscal deficit. We know these exist. And, it is because we know they exist that the hon. Finance Minister has been travelling all over the country and re-assuring the business community as well as the people of India at large that we are aware of the existence of these problems and it is because of our awareness, our consciousness that such problems exist, that answers are being devised.

Now, I cannot anticipate the speech that the Finance Minister is going to make on 28th of February next year, but I can anticipate this that when he comes back to the House, the figures that he will provide to this House will be better than the figures projected in his imagination and through his imagination by the Deputy Leader of the Opposition. We are not in a state of denial. We accept that there are problems in the economy. He asked as to what was the share of foreign investment in the totality of India’s investment. He was talking as if he was a magician pulling a rabbit out of a hat. We all know that the share of foreign investment in the Indian economy is a fraction of the total investment. We know it, and that is why, under this Government, particularly at a time when global conditions were satisfactory, we were able to raise domestic savings rates to over 32 per cent, and since our capital output ratio on average -- it's a very broad average -- is about 1:4, it was possible for us to say that a 32 per cent savings rate would give us an 8 per cent growth rate and we actually achieved it. Now, when there is a contraction of the global economy, it affects not only the capacity of the world to invest in India but it also affects the capacity of Indians to invest in India. Yet, that capacity has not collapsed and that is precisely why domestic rates of investment in India continue to be higher than in almost any other developing country and much higher than in most developed countries, and if there is a drying up of economic growth in the Euro Zone, in the European Union at large and in the United States of America, and North America in general, then it is inevitable that there will also be a certain shrinkage in what can be invested from abroad in our country.

(Contd. by 2K – GSP)


SHRI MANI SHANKAR AIYAR (CONTD.): But to cushion that fall, our hon. Finance Minister has travelled to several parts of the world to reassure the global investing community that India is still a worthwhile investment destination, and, that it is a worthwhile investment destination is shown by the fact that there is no substantial flight of capital even if, in percentage terms, in terms of some decimal points, there could be a decrease this year compared to the past. But these are the normal ups and downs of any economy. What we need to see is: are the countervailing measures being taken by the Government of India appropriate? If there were constructive suggestions as to how it could be bettered, that would be most welcome. I, for my part, do have some suggestions. I think, the hon. Finance Minister is absolutely on track with regard to the macro economic situation that we are able to cushion the fall in global growth rates as far as Indian growth rates are concerned, and, that we are still progressing at a rate which everybody, except the Opposition, regards as not only respectable, but in Europe and America, regarded as quite amazing, almost miraculous.

At the same time, there is an indication that the benefits of growth are not reaching the people of India in as abundant a measure as they could. The hon. Deputy Leader of the Opposition took one dimension of poverty. It is an important one, that is, the consumption dimension of poverty. The poverty, Sir, is multi-faceted. There are problems with regard to educational poverty. There are problems with regard to health poverty. There are problems with regard to sanitation poverty. There are problems with regard to drinking water poverty. There are problems with regard to food security poverty. There are problems with regard to rural infrastructure poverty, and, it is precisely to meet these multi-faceted dimensions of poverty that we amended the Constitution in 1992, and, now that we have parts 9 and 9A of the Constitution which show how we can move from a bureaucratic mode of the distribution of the benefits of growth to the people from the bureaucracy to self-delivered development by the institutions of Local Self Government, we have the means by which this enormous increase in Government revenues, brought about by the process of economic reforms, and the tax reforms that go with them, can, in fact, translate into much better human development outcomes.

And, here, I have a special plea to make to the hon. Opposition. Very recently, the Government of India decided to set up an Expert Committee on Panchayati Raj, of which I had the honour to be made the Chairman. The recommendations that we made with respect to ensuring that the system of delivery to the grassroots would be radically altered from dependence on the lower bureaucracy and on the NGOs set up by the Central Government through its CSS would be shifted to the elected representatives of the people. It is a 1,500-page report, it runs into 5 volumes, and, it is a highly technical report. The Government of India -- I am not sure whether the Opposition is aware of this -- has accepted most of the key recommendations and are in the process of implementing them.

So, I would plead with the Deputy Leader of the Opposition, having had his say with regard to the growth of the economy, would he please bring a discussion to this House on the distribution of the fruits of that growth, and, since he is anticipating coming to power next year, before he is disillusioned, I suggest that he initiates such a discussion here so that in the unlikely event of him being the next Finance Minister, he would, at least, have heard and studied in advance what steps his Government or any Government that comes to power after the 2014 elections will have to take to ensure that the benefits of growth come to the people.

(Contd. by YSR-2L)


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