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‘Freebies’ may give temporary respite to masses, but can put a dent in India’s economy

Campus Voice is an initiative by ThePrint where young Indians get an opportunity to express their opinions on a prevalent issue.

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Recently, the Supreme Court of India said, “God save the Election Commission of India if it can’t stop poll freebies”. This raises serious concerns in our minds—Are freebies so bad that their repercussions might cause havoc in the country of 1.4 billion people? Well, if you take some data into consideration, you would be startled to know that most of our states are in huge debt.

Bihar, Kerala, Punjab, Rajasthan, and West Bengal are the most stressed fiscally, according to RBI. Punjab has the highest GDSP-to-debt ratio, which is a whopping 53 per cent and is a cause of major concern. Are freebies are necessary to uplift our poor population who cannot even afford basic human necessities required for survival? Uncontrolled freebies in the form of subsidies or universal basic income may cause a major drain on the economy. Instead, we should use the money for development projects, investments, development of roads, which may generate employment and help in the long run for the economy to flourish. Unnecessary freebies may give temporary respite to the masses, but they may put a dent in the country’s economy.

Also read: Not ‘freebies’ –Tamil Nadu has given India a market-friendly Dravidian welfare model

The Venezuela case

Venezuela had one of the worst cases of ‘Dutch disease’. Venezuela was highly dependent on oil for its exports and ignored other sectors.  Hugo Chavez was president of Venezuela from 1999 to 2013, during his tenure the oil prices rose. But they were heavily dependent on oil as 95 per cent of their exports were oil. They did not diversify their economy and spent money on their socialistic policies. Hugo Chavez implemented socialistic policies, like nationalisation of private industries, welfare schemes, and price control, just to please people so that he could remain in power. He did this to make people happy without thinking about the economy in the long run. The 2020-2021 National Survey of Living Conditions (ENCOVI), conducted by researchers at Andres Bello Catholic University (UCAB), found that of the country’s 28 million residents, 76.6 per cent live in extreme poverty, which is up from 67.7 per cent last year.

The solution is to have a moderate approach towards freebies. Bribing people’s votes by giving them freebies just weakens democracy and faith in the system. What about the people who vote on the basis of the performance of candidates? It is an injustice to them and the system.

The reason why countries like Finland, Norway are able to afford free education and healthcare is due to the fact that they all have high taxation rates and a larger number of people paying taxes. In 2019, our Finance Minister Nirmala Sitharaman, told Parliament that out of 136 core people, only 8 core pay taxes. We need more people filing their taxes on time so that we can enjoy these benefits.

Nelson Mandela said, “Education is the most powerful weapon with which you can change the world.” Education can change lot of lives. Many wars have been prevented just by talking. When two intellectuals sit down, they can sort things out without the use of weapons. Education can help people in the long run. When you keep education for free, it may encourage more people to get degrees. It helps people in the long run, unlike alcohol, drugs, and other freebies, which make people spoiled and lazy.

In my opinion, there is nothing like a free lunch. And I just hope we don’t have to pay the price of this lunch in the form of recession, inflation and unemployment.

The author is a student at Dwarkadas J. Sanghvi College of Engineering, Mumbai. Views are personal

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