Reforms With Malignant Heart & Mind
Jagdish Bhagwati has rightly observed that India didn't need SEZs at this stage of economy.
Manmohan Singh and coterie in 1991 didn't bring reforms with clean heart and open mind but I dare say with malignant heart and mind.
He belonging to commission agent's family had hard corner for commission agents and the reforms were actually tailored to promote them. Industrial policies were designed to help commission agents to graduate to big league industrialists without any innovation, design and development and research.
It's a shame that his coterie talks in terms of percentage to befool the nation and invariably try to fool the world also. India's exports of manufactured goods presently are just $20b, which is pathetic figure. When they talk in terms of 8% or 10% or 20% it makes no sense but fool us.
No where in the world or at least in the developed countries governments dole out tax concessions on regular basis along with free goodies like free land in the heart of cities in tens of acres. Countries promote and support start ups and help them survive the competition in formative years and regularly collect taxes when they grow up but coterie doles out goodies only to biggest players who had not developed any technology or globally competitive product on their own.
Moneylenders have flourished during the reform charging 120% interest or more. I believe Manmohan Singh and his coterie is bunch of crooks that talk of regularizing moneylenders and micro-credit. Farming too like industry needs capital inputs and working capital and profitable returns on investments.
But the biggest blunder of the Manmohan Singh coterie is that instead of government controlling industry, it is the industry controlling the government who has no competence of its own.
SEZ policy is destructive and harmful to Indian economy.
§ India has to promote education and development of skills, by locating SEZs in few pockets next to big cities or ports India make sure there shall be no progress in these counts.
§ India already has vast area already developed at huge cost spread all over India and 50% or so of industrial units are shut down.
§ Reforms actually meant that tax collections and bank deposits were drained out in to the pockets of few commission agent families. Money that went after Ambanis over decades could have spawned thousands of globally competitive enterprises. Ambanis value additions in refinery projects are just 20%.
§ Neglect of agriculture has meant that Indians are worse off than even at the time of partition in terms of nutritional in take. In the attached data of production of food crops indicates clearly that for years India has not achieved record production in most crops marked in red compared to blue column that indicates maximum food production achieved in 2001-02. (Let me tell you friends' present figures are worse than you see in the chart.)
§ This attached chart also gives out that one bad monsoon rice production nose dives, you can't imagine production fall from 80 million tones to 66 million tones even after building thousands of dams and 11 million tube-wells.
Nation is most insecure in the hands of incompetent "Quacks" experimenting with Indian economy with their own biased rotten and malignant ideas.
Ravinder Singh October19, 2006
No need for SEZs in reforms era: Bhagwati
[THURSDAY, OCTOBER 19, 2006 03:10:06 AM]
The government and policy agents have tipped special economic zones (SEZs) to be an important driver of growth and exports for the economy. But Jagdish Bhagwati, professor of economics and law at Columbia University, and a poster boy for globalisation and free trade, feels otherwise.
"Give the current progress in reforms undertaken in earnest since 1991, there is no need to establish SEZs," said Mr Bhagwati. "It made sense to have SEZs in the pre-reform era when policies of the country as a whole could not be tweaked. That period warranted the setting aside of certain exclusive economic zones with low trade barriers and other favourable policies to enhance growth."
"Give the current progress in reforms undertaken in earnest since 1991, there is no need to establish SEZs," said Mr Bhagwati. "It made sense to have SEZs in the pre-reform era when policies of the country as a whole could not be tweaked. That period warranted the setting aside of certain exclusive economic zones with low trade barriers and other favourable policies to enhance growth."
The number of SEZs approved by the board of approval, commerce ministry, shot up to 181 in the second-half of the current fiscal from 150 in FY06. Units in an SEZ have to be net foreign exchange earners but are not to be subjected to any pre-determined value-addition or minimum export performance requirements. Big players like Reliance, Mahindras and DLF are betting heavily on SEZs.
Liberalistation in agriculture is another area on which Mr Bhagwati has strong views. "The presence of those with socialist leanings in the incumbent coalition government precludes the possibility of liberalisation of agriculture, which is a pity indeed.
Liberalistation in agriculture is another area on which Mr Bhagwati has strong views. "The presence of those with socialist leanings in the incumbent coalition government precludes the possibility of liberalisation of agriculture, which is a pity indeed.
In China, one of the things that pushed agriculture was the decollectivisation, which makes agriculture more productive. We need to examine that." He drew a parallel with the industrial sector, performance of which improved dramatically post-liberalisation.In respect of global trade talks under the auspices of WTO, the professor said there were four sets of countries that have to make concessions - India, Brazil, EU and the US. While India and Brazil are expected to make concessions in manufacturing and services, EU and US are being urged to make concessions in the area of agriculture for WTO talks to make headway. "However, the Congress Party will never make concessions on the agriculture front as they believe that would impact 60% of India's population.
The US has to accept the fact that India was not going to move on agriculture in any significant way," he said, adding that "they would have to trim down their ambitions and make concessions."Mr Bhagwati is optimistic in his outlook of the Indian economy, especially given the acceleration witnessed over the past three years. "What you have to worry about is whether this is a flash in the pan, reflecting excellent world economic conditions or has something really taken root. The growth being seen is also helping in reducing poverty."
He has warned that the danger point at this juncture is that revenues should not be wasted away and be used to build schools and provide healthcare to the poor.
Mr Bhagwati has been the economic policy advisor to Arthur Dunkel, director general of GATT (1991-93), special advisor to the UN on globalisation, and external advisor to the WTO.
Mr Bhagwati has been the economic policy advisor to Arthur Dunkel, director general of GATT (1991-93), special advisor to the UN on globalisation, and external advisor to the WTO.
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