A week is a long time in politics; ten days is an eternity. Ten days ago, the Congress-led UPA government was weighed down by the scams and scandals that have enveloped it since its return to power in 2009. The economy was down, the fiscal deficit was up, the ratings were near-junk, the writing was on the wall.
It was deja vu 1991 in circa 2012.
But the partial rationalisation of diesel prices followed by the announcement of foreign direct investment (FDI) in multi-brand retail, aviation and broadcasting (followed by a slew of measures including one rank-one pension for Army wallahs, dearness allowance hike for government employees, etc) have changed the headlines.
Suddenly, the coal scam is off the front pages and nightly news.
Suddenly, the main obstacle to reforms (Mamata Banerjee) is out.
Suddenly, the “underachiever” prime minister is talking.
Suddenly, there is talk of a reshuffle of the Union ministry and Congress party apparatus.
And, on top of all that, the entire opposition from the left to right is united in its opposition to FDI in retail, citing the interests of everybody from the farmer down to the consumer, to dire warnings of economic slavery and colonisation of the mind. Even Narendra Damodardas Modi who has gone around with the FDI bowl in his hand to more countries than most chief ministers is warning of the “foreign hand”.
What last week’s Bharat bandh (in which UPA ally DMK too took part) and today’s BJP suggestion of a rollback of the FDI in retail should it come to power, have done is to willy-nilly paint the Congress as the only “pro-reforms” party in the country ahead of 2014, which is all the more surprising because this was the party which in the last few years had turned subsidies into an entitlement.
Questions: Will the reforms work in reviving the economy and will that in turn convince the electorate to plump for UPA-III? Or, is it just a desperate last-ditch effort by the Congress to revive its chances, one doomed to electoral failure? Will the aam admi see through the xenophobia, or will he let his wallet do the voting?
The New York Times: Reforms do win elections in India
churumuri 
This title is going to give heart-attack to ‘non-Simple’ folks on Churumuri.
~*~
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we as a people have no choice………………
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Reforms…what reforms….it is a sham and a election gimmick to start with…it is comparable to another sham the nuclear deal signed by UPA without taking the opposition into confidence and hoodwinking the people. This FDI in retail was in the pipeline for several months now…why this seething hurry to push it through just after the Rajmata returns from USA. Who did she meet there and what conspired between them? Walmart has said it has spent Rs.62 crores on lobbying for the FDI in retail to open up..how much has walmart spent that is not accounted for and who are the beneficiaries. Moreover, a government which has blackened its face with coal scam has no business taking major decisions like FDI in retail.
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asha:
The reforms that have been announced were long-needed, and are a breath of fresh air. You should stop letting your political views get in the way of national interest.
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Yes….the day pigs start flying
And 40% want UPA III, wow!! ….
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Vinay,
No doubt reforms are needed but not by this dispensation and definitely not by a PM who supervised scams after scams during his tenure. Believe me, national Interest is the last thing UPA had in mind when it pushed through the reforms.
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Indian electorate consists of, for practical purpose, rural populace and the biggest minority in the country namely Muslims. They don’t vote by their heads but sadly by their hearts. So anything is possible. UPA 3 is very much in realms that possibility with or without recent but belated eye wash, reforms.
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And 40% want UPA III .
so there. upa3
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asha:
I don’t understand your absurd and silly logic.
“Reforms are needed but not by this dispensation” – what do you mean, so would you rather have them sit tight till the next elections, and completely run the country to the ground by that time?
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@Vinay
Sorry to disagree with you bro, but reforms a fresh air? Ok, but for whom? For the common folks? I don’t think
FDI in aviation will help fat cats like Mallya to become fatter. Will it bring down air tariffs? Did the growth of private airlines create a customer-friendly environment for air passengers? I don’t think so.
And FDI in retail will definitely benefit the MNC’s no doubt. But I don’t see how common man will be benefited? He will get variety of products? But he is already getting them at Big Bazar, Reliance Fresh, etc. Farmers may benefit and that is also highly doubtful.
Basically these reforms helps to push the stock market up and corporates valuation goes up. These reforms helps only corporates and none else. And if Govt. helps corporates, naturally there will be a quid pro quo – additions to motamaal!!
This reform is like the nuclear deal, lot of hype of noise, but a big dud – not of any practical value.
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Majority of this country doesnt understand what reforms mean. The man/woman on the road only know that petrol/diesel/electricity is going beyond reach. They can’t anymore sell their wares on the road if FDI comes into existence. Majority of the voters belong to this category.
These reforms can only be understood by financial experts or people who understand what reforms actually mean. UPA III is a pipe dream of UPA II.
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@ Vinay,
This is a government which is surviving on lies and deceit. This is a government which has a prime minister who is not a representative of the people, who doesn;t owe anything to the people of this country. His entire loyalty lies with the Italian Madam.
Here are two instances which bring out the lie and deceit of this dipsensation. You then decide whether they are fit to be in the government in the first place, let alone carry out reforms.
The PM, in his address to the nation, justified the hike in diesel prices. And what was his justification? THat the nation imported “80 percent of our crude oil”, Government provided fuel to the common man at a much cheaper price and had to compensate the oil marketing companies for the losses they were incurring because of this subsidy and that the subsidy amounted to Rs.140,000/- crores in the year 2011-12 and therefore there was no option before the government other than raise the fuel prices.
Now here is the truth, not told by me. Or as told by BJP. But by the Ministry of Petroleum & Natural Gas, which is under the control of the same dispensation.
In the advertisements this ministry released a few days before our man opened his mouth on the national TV, it said :
1. 74% of India’s crude oil requirements are imported. not 80 % as this fraud of a PM claimed. Let us give the benefit of doubt to this old man, he wanted to round off the figure( though while rounding off, the norm is to round off to the nearest ten, which is 70% in this case!!)
2. The same ad further said that the under recovery of petroleum marketing companies were Rs.1,38,541 crores as against the Rs.1,40,000/- crores claimed by PM. I know, for these congress crooks thousand of crores have no meaning and giving the earlier benefit of doubt of rounding off the figures, let us move on.
3. Now comes the best part. The advertisement further said that this kind government, which subsidised the poor of this country to the effect of Rs.140,000/- crores also collected a whopping sum of Rs. 83,700 crores as tax from the oil sector. It also said that the government was a net loser of Rs.54,800 crores.
This makes me think. MMS says the loss to the government was Rs.140,000/- crores. The advertisement says Rs.54,800/- crores. Who is right?
Is this not deceit of the highest order?
Now let us come to the lying part.
In the very same speech, MMS said “money does not grow on trees”. Our english language media were orgasmic with joy hearing this bit of news. It was as if this so called economist discovered something new! He said that because money does not grow on trees, he is forced to resort to FDI in retail and increase the price of diesel.
Rewind one year back. To the time of UP elections. The clown price, er the crown prince of Congress Amul Baby, was crying hoarse in campaign after campaign in UP ” Sarkar ke paas bahut paise hain lekin woh paise aap tak nahi pahunch rahi hai”.
So in 2011 sarkar had loads of money to spend for people. In 2012 sarkar resorted to the cliche that money does not grow on trees. Therefore what exactly happened in the last one year? That we had to go so broke?
The third point… last time around, when the same FDI issue was threatening to topple the government, the then FM and the present President had said in Parliament that the government will not take any unilateral action on the issue of FDI without discussing the issue on the floor of the parliament and without taking into confidence the allies and the opposition in this matter.
Now who is going back on the words? Agreed, Pranb da has been kicked upstairs. But is this government not bound by what commitment its own FM gave on the floor of the house?
So now you decide if this fraud of a government should be trusted at all in such serious matters?
PS: Is there a link between Sahara Group entering into retail space and the undue hurry shown by the government in clearing the FDI? Just a thought,,,,,,
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UPA has destroyed itself to the extent that no amount of popular measures will help
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CNN-IBN’s poll shows a massive public rejections of the much vaunted reforms. It also reveals a strong rejection of the UPA and the so-called reformer.
Very interesingly, in the past few days NDTV, HT and CNN-IBN are slowly becoming soft to BJP and harsher on the Congress. Probably, the media which was behaving like a division of the Congress, has realised which way the win is blowing.
Chururmuri of course will never highlight such polls. They will prefer their own polls which shows that people want UPA III
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Deepak:
Of course growth of private airlines made things better for the consumer. What are you talking about – did you travel by airlines in the 1980s? Most probably not, only the richest of the rich could do so. I don’t know what point you are trying to prove here, by claiming that growth of private airlines has not helped the consumer.
Your understanding of FDI in retail is also very limited. It is one of the best reforms that has been initiated in the recent past.
Anitha:
You have to live with the fact that Cong is here till 2014. So, hope that they initiate more and more reforms instead of letting the country stagnate. Nothing you typed in really matters, the fact is that you have to live with the Cong till 2014, and you might as well hope that they continue reforms and take India back to the days of high growth, as long as they are here.
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@Vinay
I didn’t talk about lowering of tariff compared to 80s. Can you say that private airlines are genuinely better than the Govt. airlines? Are they really interested in pro-customer measures? Haven’t we seen how they time and again fleece the customers when they get the chance? I am sure you have read about how they looted those going to North East during the recent crisis. My point is that entry of foreign airlines may not create a customer-friendly environment for the consumer.
And regarding FDI in retail, since you seem to have a greater understanding of the issue, can you kindly highlight how it is the best reform initiated and also clarify how it will benefit the consumer?
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Right now, I am cheering MMS for finally showing some spine and getting on with his job. And not bowing down to Mamata Bannerjee and her likes. After the Nuke Deal, this is another good phase of MMS. Took a long time, but better late than never.
Diesel price hike was inevitable and long due. Subsidies should be gradually phased out and fuel prices should be unregulated as any other commodity.
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Yes UPA-III is a reality, not because of reforms, but because of the clueless opposition. The UPA will use the trump cards just before elections. MMS alredy showed one today, that is direct cash transfer to the BPL citizens. With the GOP throwing more such trump cards one after the other the opposition has to simply watch with gaping mouths and drooping jaws.
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Let us understand the difference between reforms and Liberalization.
Reform is to change what is corrupt or wrong with a process that is transparent and right.
Liberalization is to free or relax previously existing restrictions.
By what measure is UPA reforming? Has it done anything to reduce corruption, increase transparency and punish the wrongs in the system? Has process of decision making changed??
What it has done is at best is Liberalization, not reform.
It is like a man refuses to go to the toilet for four days, and finally when it becomes unbearable visits the loo and let’s out a bit.
Should people be applauding his efforts, or cursing his stupidity?
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Deepak:
There is just one question that needs to be answered. Is the aviation sector better after the entry of private operators, or worse? Overall, it is much much better. Only a very dishonest person will claim that things were better in India in the 1980s and before.
And if you see an improvement in service and quality of AI, IA, SBI, and other customer-facing PSUs, it is simply because they have been exposed to competition from private operators.
Every private company tries to maximize its profits, and if they try to fleece customers when they can, they are just acting natural – but we cannot go back to mai-baap NehruGandhi government now because of that, can we? Entry of more operators and more competition ALWAYS creates a better environment for the customer.
There have been a lot of discussions about the pros and cons of FDI, even on churumuri. You can search the archives of churumuri, where I have provided my points.
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Goldstar:
Well said. This is looking like 2009 all over again. Stupid BJP taking a hypocritical stance, opposing reforms which they themselves would have initiated had they been in power. I am cheering the sardar too.
I wish we could have a government composed of pro-reform sensible folks like MMS, Chidu, Arun Shourie, and so on… keeping the jholawalas and cracked women out of it!!
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@harkol,
>>Should people be applauding his efforts, or cursing his stupidity?
We should be applauding his efforts in the hope that he will not be stupid in the future.
If the right-thinking people don’t encourage MMS’ efforts at reducing subsidies, then he/Congress can go full steam ahead on socialist policies of NREGA, Food security bill, loan waivers etc. That will be a disaster.
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It is not just amusing but amazing to see the gullibility of intelligent folk who still believe that MMS and Chidu are reformers! MMS is no reformer – BJP exposed his stand on FDI in retail by releasing his letter, but the Congress-chamcha media cleverly saved him not highlighting this issue. MMS & Co believe they are robin hoods, with a new dictum though – rob the aam admi to feed the vote bank.
They robbed the aam admi through diesel and LPG hikes.They will now use that money for massive sops for the poor like food security bill and so on, thereby cementing their votes -fiscal deficit and prudent economic governance be damned!! MMS has the gall to talk about money on trees when he is busy organising 7000 a plate gala dinners!!
Even in 1992, reforms came about as a compulsion because of pressure from World bank. 2012 reforms came about because of credit agencies. No way MMS is a reformer, he is a sham. I sincerely pity his fans for their credulity.
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Deepak:
I agree that we should do away with populist subsidy schemes that only serve to cement their vote bank.
However, instead of focusing on whether MMS is a “reformer” or not, look at the steps that have been taken, instead of focusing on the individual. There is no denying that these steps that have been taken are positive steps. Only jholawalas and madwomen like Mamata Bannerjee will deny that.
Speaking of BOP crisis, the rupee as already gained, and will end this year at 50 to the dollar, because of these reforms. For a nation that imports 80% of its fuel requirements, the best way to get into another BOP crisis is for the rupee to weaken further. If these steps had not been taken now, we would have been on our way to junk status now.
Finally, the real problem is with the Gandhi family. They treat India like their fiefdom, and will not lose their “rural poor” votebank, the country’s long-term future be damned. MMS and Chidu had to convince Rajmata to let these reforms go through, she was very very reluctant. She did not want to risk alienating her votebank. Pranab-da is a jholawala anyway. MMS may not be a “hero”, but in the kingdom of the blind, the one-eyed man is king. Chidu and MMS are far better for the nation than the parasitic bloodsucking Gandhis.
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@Vinay – I agree 100% with what you have written. But honestly are these ‘reforms’ adequate? Can they really be called reforms? Reforms should lead to some positive change. But it seems unlikely that these set of reforms would lead to any meaningful change. Had MMS ordered drastic expenditure cuts for his Govt, then that along with some strategic disinvestment would have really helped to improve the fiscal deficit situation.
In this dire economic scenario, putting hardships for the common man and raising a contentious issue like FDI in retail doesn’t seem to be apt. That;’s my humble submission, what do you say?
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Well, I have come to believe that for MMS to liberalize, there should be someone administering some ‘laxatives’ to him.
:(
In 1991, it was IMF & PVN. This time it seems like it was Washington Post & Time magazine, along with our own RBI governor.
Shows him in real poor light.
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Brilliant work by UPA do boost an economy which is already on a huge high (even before the reforms) . Those sour faced cynics who snigger, let them look at themselves. have the been pink lslipped? have their living standards fallen? have they stopped going out to eat and drink and watch movies?
Unprecedented economic boon in India is a direct result of the policies of UPA.
Cong is gaining all over the country. From Gujarat to Karnataka, Cong is set to improve its position significantly.
And those foolish journalists and fake experts on this site, will then open their mouth wide in astonishment saying “this is a surprise victory for UPA”
They said the same thing in 2004
And repeated the same dialogue in 2009
Encore 2014
Hats off to MMS.
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LOL Simple you are in full form. I really missed you, the debates on the site have nowadays become sharp, its good that the court jester is back to make us all laugh till it hurts ;)
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Deepak, I had the last laugh in 2004 (experts like you predicted NDA will return under Vajpayee)
I had the last laugh in 2009 (experts like you had predicted Cong will go below the 100 digit mark)
I will have the last laugh in 2014 too (experts like you are predicting Cong will face a rout)
Just hang on…you will see..
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