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India Averted Financial Emergency: Finance Minister Chidambaram

The Finance Minister, P. Chidambaram, has said in an interview to a TV channel(ZeeTV) that the reforms announced in the recent weeks have averted a financial emergency! This confession from no less a person than the finance minister of India validates my apprehensions about it contained in some of my posts on this website and the other website, whispersinthecorridors.com. The decline in governance in the country in the past 8 years was loudly indicating to that development. Instead of governance as mandated by the law, the regulatory power of corruption has credited this government with the title of  the most corrupt government ever. The reason was that the people managing the affairs of the government have come to acquire that position after more than 15 years. They were, therefore, to first recoup the losses suffered by them and then stock enough wealth to survive them for the rest of their life. They have no ideological affinity or loyalty to either the Congress party or the family of Jawahar Lal Nehru. They are self-centered people, who have grown wiser by now, and have developed fairly good survival skills. They know that the Nehru family rule is in its last lag. They also know that the prospects of the Congress winning the 2014 general elections is a distant dream. So they were to (ab)use the emergency powers to cling to power. But promulgating Emergency again after the terrible experience of 1975 was not possible. Hence the other alternative was to first ruin India’s financial health and then go in for financial emergency. As this would be an altogether new variety of emergency, it will take time for the people to understand its implications, it would have proved a success for the dreaming captains of corruption.

It is our national misfortune that we are putting up with a proxy for a government. There is “honestly” no legitimate government as enshrined in the constitution. It is just a semblance of government, a shadow, a midsummer night’s dream! Chidambaram is not known to make light comments. He would not have used the “financial emergency” to convey the real position, knowing how allergic Indians are to the word emergency. Hence, it causes anxiety when a person like him freely uses these words. There is indeed reason for him to say so, because he would  not like to go down in history as the finance minister who ruined the Indian economy completely. It is a said fact that there are more than one set of people pursuing their own private agendas while appearing to be a part of the government. The point needs to be noticed that it is a coalition of disparate elements, some of whom are being investigated by the anti-corruption agencies also. When such partners pursue their individual agendas, it is always at the cost of the country and its sovereignty. The fact that the country has been driven to a situation where financial emergency was going to be the only option, is suggestive not only of failure of governance but the dangers posed to the very financial stability of the nation. This has been the result of an economist prime minister and dozens of his economic advisers of the last 8 years, systematically playing with the financial stability of the country. The condition remains serious. The finance minister’s attempts to assure the people that the so called reforms in the shape of FDI in multi-brand retail, aviation, insurance and pension have been announced to save the country from the impending financial emergency are misplaced and unconvincing to say the least. On the contrary, they are in the nature of “reverse mortgage” of India’s financial assets. Only one example will suffice to prove the point. The Life Insurance Corporation of India (LIC) is sitting over a pile of rupees 800000 crores. Has the government tried at all in the past 8 years to streamline its working, making it function like a genuine corporate in the environment of a free market economy, driven by market forces? Has the government brought about even one “reform” in the working of the LIC? The LIC and the public money it manages has been misused to bail out corrupt businesses of the favoured few in the past 5 decades. The public money has been lost on businesses that should have been jailed for swallowing public equity while their personal wealth grew many fold. The policy that this government adopted was pointing towards attempts to deliberately destroy the nation’s economy, when they forced core public sector units to “vacate” the capacity so that their friendly private operators could rake in the windfall gains. The destruction of the Mahanagar Telephone Nigam(MTNL) or The Bharat Sanchar Nigam(BSNL),Air India, Indian Airlines etc is a living testimony of that policy. In the name of “disinvestment” the government has vacated capacity, turned running undertakings sick, transferred valuable assets including valuable lands to private interests at throw away prices, sunk the country and the administration into corruption and made innumerable scams of historic proportions. The worst shall come when the retail and financial business will be destroyed in the remaining few months of this government. But there shall be a major difference- the injuries inflicted by this government on the financial body of this country would heal in due course though they shall continue to pain for decades, but the afflictions caused by the wrong decisions of the past few days in the name of reforms shall never be cured. India enters a new phase of finance subjugation, a new beginning of an economic subjugation, a reversal of the scheme of governance as laid down in the constitution.

The finance minister is not in the effective core group that decides on matters like imposition of emergency in the country. He might have simply made an honest statement in the normal course of his official business. But it might also be indicative of his anguish at the prevailing situation. He is extremely careful in his assertions and chooses his words more carefully than many of his colleagues in the council of ministers or the party. So much so that he has been accused of being “intellectually arrogant” by his Party General Secretary. Chidambaram is more than a politician- he is a statesman also. When he says financial emergency he says many things without waxing elaborate. The country has decidedly been thrown into a very precarious situation because we trusted Manmohan Singh’s competencies as an economist. Unfortunately he has not lived up to our expectations. If he has the welfare of the people of India at heart, he should immediately resign and call for mid term polls. Pulling on this weight of a corrupt coalition alliance any further is a sure guarantee of failure of government, breakdown of the constitutional machinery in the country and multi- organ failure of the financial entity of India. The financial health of the nation needs to be restored rather than pushing projects of its further deterioration.

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