The Hindu : National : Food-for-work, universal PDS are priorities, say economists

Online edition of India's National Newspaper
Tuesday, Jul 06, 2004

National

National

Food-for-work, universal PDS are priorities, say economists

By Our Special Correspondent

NEW DELHI, JULY 5. Economists participating in a convention today demanded immediate introduction of a food-for-work programme, especially in areas characterised by acute hunger. This should be complemented by a universal public distribution system since the promised Employment Guarantee Scheme would take time, they said.

The convention, India: Economic Agenda for 2004, organised here by Sahmat and Social Scientist, demanded a complete write-off of non-small savings debt of the States and lowering of the interest burden on small savings debt through debt swap. It was also suggested that all future interest rates on Central loans to States should be well below the gross domestic product (GDP) growth rate.

Some economists said that a transition to the Value Added Tax system carried with it a serious threat to State finances and should be put off till its implications were examined in detail.

The convention felt that the vote against the National Democratic Alliance Government in the recent elections was also a rejection of the neo-liberal economic policies that have been pursued for the last 13 years and which the NDA in particular was pushing relentlessly. The pursuit of these policies had led to severe deflation of the economy, reducing the purchasing power of the rural population and reduced per capita foodgrain absorption to levels prevailing at the beginning of the Second World War. The policies had played havoc with the agrarian economy with extreme tangible consequences by way of mass suicides by farmers; they had greatly aggravated the problem of unemployment in both rural and urban India and that they had not only accentuated income inequalities but also handed over public assets to favoured private individuals at throwaway prices.

Among others, the economists who addressed the convention included Jayati Ghosh, Prabhat Patnaik, Ashok Mitra and C.P. Chandrashekar.

The economists warned that the Common Minimum Programme of the United Progressive Alliance should not be impeded by the state of the stock market which had hardly any bearing on the level of corporate investment, let alone overall investment in the economy. Corporate investments would be stimulated by larger public expenditure, they pointed out.

Some other points made at the convention include increase in the Central tax to GDP ratio by introducing service taxation, asset taxation, taxation of financial transactions and taxation of foreign exchange use.

Printer friendly page
Send this article to Friends by E-Mail

National