UPA-II report to people 2010-11

There is lots in the media on this topic today. Mostly people are disappointed (And rightly so) with the current government.

Here are the links of the report:

I just had a few things to discuss.
 
First from Highlights of the Report. It first says:
  • Took several steps to address the problem of food inflation including selective ban on exports and future trading in food grains.

And then says:

  • Increased support prices for farmers.

It is so funny really. First you say measures for lower inflation and very next mention something which leads to rise in inflation.

But then how did any of these measures help in tacking inflation?

  • Selective ban on exports just explains the problem right away. It is selective done randomly as per the wishes. There is too much discretion. Moreover, food inflation only worsens with these selective export bans as India is a large producer and this effect world supply of food. It leads to rise in volatility, imports etc leading to more uncertainity.
  • The same random behavior applies to future trading. Just fuels speculation over government moves leading to hoarding etc

The main report says on inflation:

The overall year-on-year WPI inflation stood at 8.98 per cent in March, 2011, which was a significant decline from the peak of 11.00 per cent recorded in April, 2010. Several measures announced in the 2011-12 budget to improve supply in the medium-term are expected to address the imbalances in the agriculture sector. Fuel prices, however, remain high, reflecting global trends.

First, Mar-11 inflation has just been recently revised to 9.02% (the press release says 9.04%, god knows how) because of some error. After nearly a week this report is released and mentions inflation at 8.98%. Second, Mar-2011 is yet to be finally revised. It could easily be around 10-10.5% seeing current revisions and would not mark a significant decline as the report says.

The main report expands further on measures but none of them have really been effective. Lower numbers are coming because of very high base effect. The only respite these days is to see the base-effect. If the prices had shot last year, one expects current numbers to be lower because of base-effect. Index keeps rising.

In highlights there is no mention of the measures taken for the most important problem for India – corruption. The main report too just mentions corruption lightly. It should have included a full chapter on corruption in India and how government is tackling it. There is just a section called anti corruption measures which appear as half-hearted as the measures on inflation:

In January 2011, a Group of Ministers was set up to consider measures that can be taken by the government to tackle corruption.  The terms of reference of the group include considering all legislative and administrative measures necessary to tackle corruption and improve transparency; fast tracking of all cases of public servants accused of corruption; ensuring full transparency in public  procurement and contracts, including enunciation of public procurement standards and a public procurement policy; relinquishing discretionary powers enjoyed  by Ministers at the Centre; introduction of an open and competitive system of exploiting natural resources, etc.

As one of the impediments felt in tackling corruption is lack of adequate protection to complainants, “The Public Interest Disclosure and Protection to Persons Making the Disclosure Bill, 2010” has been introduced in the Lok Sabha on 26 th August 2010.

India has ratified the United Nations Convention Against Corruption. With a view to ensuring full compliance with this Convention, “The Prevention of Bribery of Foreign Public Officials and Officials of Public International Organizations Bill 2011” has been introduced in the Lok Sabha on 25th March 2011. 

 Nothing to say on this.

PM says on corruption:

Finally, there is the challenge of good governance and the need for political stability. In the past several months a conjunction of several developments relating to 2G spectrum allocation, procurement and contracting issues related to the Commonwealth Games, and similar issues in state governments have brought public focus on the issue of corruption in public life.

The developments have caused many concerned citizens to worry about the state of governance and the pervasiveness of corruption. These are legitimate concerns and the UPA government is determined to take corrective action. The due processes of law are already in motion. We are taking steps to prevent such developments in future and reduce discretionary and arbitrary use of power by public officials.

Towards the end he says:

Even when economic and political stability are assured, the threat of terrorism looms large….

Terrorism is a major issue but can we take economic and political stability as assured? Political stability?

Then UPA chairperson’s speech:

The much needed amendments to the Land Acquisition Act, and the Rehabilitation and Resettlement Act, still remain to be  introduced in Parliament because of the disruptions to its the functioning by the BJP. We are determined to introduce and pass these Bills in the Monsoon Session.

Much has been said over the last few months on the issue of corruption. As I have just stated, transparency, accountability and probity are at the very heart of our governance. Our actions amply demonstrate this. It is unfortunate that many opposition parties, especially the BJP, do not share the same high standards of probity when it comes to their own. 

Best strategy in India’s polity- blame it all on the opposition..

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