New Delhi: Reducing the cost of doing business, reforming the current land acquisition law, providing financial support to the low-income strata of society (which will help create a demand in the economy), and creating a new manufacturing policy. These are some of the key suggestions the BJP has sent to the Narendra Modi government for reviving the economy post-Covid-19.
The suggestions are the outcome of several meetings the BJP has held with over 50 leading economists, large industries, and those engaged in new fields such as big data, artificial intelligence and e-commerce.
A number of Rashtriya Swayamsevak Sangh-affiliated organisations have also held discussions on the economic front, and have shared their concerns and inputs with the government.
RSS’s economic affiliate Swadeshi Jagran Manch (SJM) and labour union affiliate Bharatiya Mazdoor Sangh (BMS) have also cautioned the government against what they term as the “China dependency”, asking it to focus on the agriculture sector and strengthening the role of the public sector.
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The consultation process
Gopal Krishna Agarwal, national spokesperson of the BJP on economic affairs, explained the consultation process that he led.
“We had four major sessions with the leading economists, industry representatives, small and medium enterprises, non-banking financial companies and AI experts. The party has a strong network, so we are able to give ground information to the government. The government requires such feedback and the current dispensation, both at the party level and the government, is quite open to these thoughts,” Agarwal said.
“We had made four consultative groups — one on the emerging global economic order, one on the Indian economy post-Covid, the third on the SME and NBFC sector, and the fourth on big data and artificial intelligence and building state capacity,” he said.
“Our consultations centre around the suggestive measures on how things will evolve post the pandemic and what should be India’s response… What exactly needs to be done to catalyse and revive the economy,” Agarwal added.
These consultations happened between 3 and 10 April, and included senior BJP leaders B.L. Santhosh, Jayant Sinha and Ram Madhav.
Another BJP leader who was part of the consultation process added: “A few suggestions were based on the impending labour and land reforms too. If major manufacturing units leave China, many experts feel India is unlikely to gain in this scenario because the cost of doing business in India is very high compared to other South-East Asian countries. We have to carry out major land and labour reforms to make our product competitive in price and quality.”
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The need for land acquisition reform
On the issue of land acquisition reforms, Agarwal said: “Land acquisition has become a tedious job and needs to be simplified. To attract investment and to make India a manufacturing hub, it is required to reduce the overall cost of doing business, including reforms in the labour market,” Agarwal said.
According to a BJP source, it was pointed out in the meeting that land acquisition is a difficult job in India, and that discourages many from investing.
“There are times that while 80 per cent of the land is acquired easily, the rest gets embroiled in some issue or the other. Many end up going to court and the case gets stuck for years. Naturally, business persons will think twice before investing,” the source said.
Relief for lower economic strata and SMEs
Agarwal said the government is proactively considering these suggestions, and has been implementing them wherever suitable, including providing support to the needy.
“Immediately after the lockdown, the first priority was creating financial support to the lower strata, considering that this will also create demand in the economy. Marginal utility is highest amongst the lower strata of the population,” Agarwal said.
“For large corporates and bigger industries, RBI has announced relief with credit availability. There was a strong demand from the SMEs and NBFCs, which has been met in the recent RBI announcements,” he said.
“The coronavirus crisis has brought to fore the mass exodus of migrant labourers and we know the importance of migrant workers for the economy and the industry. This crisis has shown that in future one needs to make large infrastructure arrangements for migrants with facilities for housing, education and sanitation,” Agarwal said.
“Though it will increase cost of manufacturing, but this will halt mass exodus. Right now, help has been provided through DBT like MNREGA, Ujjwala and PM Kisan Yojna etc., but in the long run, industry has to work on incentivising migrant labourers to return,” he added.
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China dependency
BMS president Saji Narayanan told ThePrint that reform is the need of the hour, and India must reduce its dependency on China.
“It is now time to reshape the economic direction and the China dependency has to be reviewed. We have to become self-reliant. In a crisis, we acted in a creative manner, and similar things can be done in a non-crisis time,” Narayanan said.
“Due to coronavirus, the market was completely paralysed. The role of the private and public sector came to the fore and the private sector could not deliver. The public sector and the social and service sector played a huge role, and in the post-corona economy they need to play a major role,” he said.
“India will be able to get over the economic issues as it was least affected in 2008. We have been talking to the labour ministry, finance ministry and even the PM and giving our inputs. Our industry is totally dependent on China for the raw materials, and we need to reshape that and find innovative ways to address that,” he added.
The SJM too highlighted the Chinese influence. “We have been highlighting issues of Chinese takeovers of companies and how agriculture needs to play a more significant role. At the same time, we need to strengthen our manufacturing and from ‘Make in India’, we need to move to Made in India,” said Ashwani Mahajan, national co-convenor of SJM, who was also part of the consultation process.
New national manufacturing policy
Agarwal, meanwhile, said people are expecting the government to come up with a new national manufacturing policy.
“The lockdown has shown vulnerability to dependence on one country. Many experts have suggested new potential in the manufacturing sector for India in the new global order,” he said.
“It is essential for India to build on our manufacturing facilities and have to make manufacturing more competitive. People expect the government to formulate a new national manufacturing policy,” he said.
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All this is only whistling in the dark. The reality is that the BJP is no different from the Congress or Communists when it comes to economic policy. The same distrust of business and the Indian entrepreneur, the fixation of a loss making PSU thriving on tax payer’s money, government owned banks channeling tax payers funds to crony capitalists, pampering a labour aristocracy at the cost of millions of unorganized workers. Nothing is going to change . It will be back to business importing from China etc once the crisis blows over.