The Sinha versus Sinha saga: a pantomime of clashing interests and priorities

opinion | Saturday, September 30th, 2017
Virendra Kapoor
Highlights

Of course, we can do without such levity. Former Finance Minister, Yashwant Sinha, and his minister son, Jayant, are exceedingly bright. They seem to know what they are talking about. Their views on the current  state of the economy, expressed by  Sinha Sr.  in a column in the Indian Express, and by Jayant in the Times of India, were bound to attract notice.

Despite the disparate distance between the contents, focus and emphases of the two columns, it is possible to locate some common ground: the economy is under stress, alright, but, as  Sinha Jr., underlines, ~acchhe din~ might not be too far away on the horizon.

Where the 80-year-old Sinha seemed to have  gone horribly wrong was to allow his own personal prejudice and pique to cancel out some very valid criticism of the recent economic decision-making. Particularly painful for the country was the abrupt and ill-implemented notebandi followed virtually on its heels by the roll-out of the half-cooked GST. Nobody in his right mind would deny that both well-meaning and far-reaching reforms could have done with greater preparation and better imagination.

But if Sinha Sr. was to put himself into the shoes of the decision-makers, he would immediately realise that when you have 30-plus cooks rustling up a  meal, the end product cannot be most edible. Yes, the GST in its present form is far from being `one nation, one tax’ it was billed out to be. But it is better to press ahead with a half-baked reform than none at all.

Yes, there are hazaar glitches, hazaar headaches in understanding and implementing the new-fangled tax at the level of  individual tax-payers. But to suggest that we should have waited till the 30-odd cooks, that is the 29 State and seven UTs  together, came up with a perfect version of GST is foolhardy.

Once implemented, it is expected that the rough edges will be smoothed and  enforcement made easier for faster and hassle-free compliance. Those who want to pay ought not to be made to suffer unnecessary emotional and financial stress due to the shortcomings in the GST network.

Besides, it is harsh and unjust on millions of small- and medium-traders to file monthly returns in triplicate, especially when they haven’t felt the need to pay any sort of taxes all their working lives.

Yes, it is a commendable project to make honest citizens of us all, but a wise king would always temper idealism with common understanding about the ingrained nature and tendencies of his subjects. Right now those crying the loudest against the poor implementation of GST constitute the core of the BJP constituency.

The we-couldn’t- care-less attitude of the Modi Sarkar has spawned angry protests by various traders’ associations, particularly those dealing in textiles, milk products, and even garment exports. This requires immediate attention of the authorities. Requisite changes to accommodate the genuine concerns of the people even if it entails a temporary loss of revenue and diminution of the GST concept ought to be made. Making it a prestige issue can only lead to further alienation of the ruling party’s support-base.

It seems that the Government proceeds on the assumption, not easy to dismiss though,  that ~ sab chor hain~ and would do their worst to avoid paying their due to the public kitty. However, this belief has led to an across-the-board blacklisting of Shell companies not all of which were in the illegitimate business of money-conversion and not all of their directors were culpable of wrong-doing.  

Such an indiscriminate, nay, ruthless approach to public policy is  unnecessarily creating enemies for the government. The single-minded enforcement of honesty in taxation matters needs to be tempered with considerations of equity and justice in order to ensure that the innocent do not suffer in the rampant raid raj that threatens to drag every businessman in its arbitrary sweep. Besides,  a lot of black sheep in  the  tax bureaucracy need to be weeded out.

Now, for the criticism that the GDP is down to 5.7 percent in the last quarter. As any economist would tell you, not all of it is due to notebandi and/or GST. Some of it is certainly due to the global cyclical decline. The Fed is threatening to unwind soon.


Global crude prices are once again inching upwards. Foreign funds are pulling out money from the BSE. Contrary to early Met predictions, monsoon has been deficient and uneven. Again, cotton farmers in Punjab are getting below the minimum- support price. Despite general price stability, food inflation is beginning to rise. And lack of fresh job opportunities in the organised sector is directly linked to the financial anarchy and crony capitalism that had reigned unchecked in the previous UPA decade.      

Therefore, it does not lie in the mouth of someone like P Chidambaram to blame the current government for the downward spiral in the economy after the mess he had left behind in May 2014.  The organised loot and plunder of the public funds that was the order  of the day, particularly after the Lehman Bank  crisis in 2008, had left the banking sector gasping for breath. The humongous amount in non-paying-assets of the public sector banks virtually denuded both the lenders and the borrowers of any capacity for further lines of credit.

Poor credit offtake is the direct result of the yeoman’s efforts by the Modi Sarkar to recover lakhs of crores of public funds lent at the say-so of ministers in power or their near and dear ones for hefty commissions.

Ever-greening of dud loans was rampant under UPA. Those who now pillory Modi for the slowing economy should pause to consider how the big borrowers are now being made to cough up bank funds at the pain of jail and loss of their business empires. No other regime in free India has gone after the big fish as this government has, forcing iconic names in business and industry to sell companies to repay banks. The pioneering bankruptcy code was enforced by Modi, though the UPA under the pretext of liberalisation had handed over keys of the bank vaults to crony capitalists.

Give credit where it is due. Modi has shown  zeal to enforce honesty in the conduct of business. It is an uphill task. Those used to free lunches at tax-payers’ expense will resist, and egg on their accomplices in the Opposition to create anti-Modi ~hawa~. But you can rely on Modi to heed genuine criticism and make necessary changes. Both  GST implementation and the somewhat harsh and counter-productive  petroleum product pricing is soon to be softened, in order to blunt the incipient Opposition challenge.

As an adviser to that hypocrite Arvind Kejriwal,  Yashwant Sinha’s peevish cry  could well be justified. Also,  its ready endorsement by the likes of P Chidambaram might reflect the poverty of ammunition in the Gandhis-owned party. But what the senior Sinha needs to ponder is whether it was  proper for a leading light of the ruling party to air his vituperation through the columns of a newspaper.

Again, by complaining that for ten months Modi had refused to meet him, he only detracted further from whatever little conviction he could have carried with his angry swipe at the Finance Minister. Not being where Arun Jaitley is causes heartburn to a lot of people in the BJP, Sinha is not the only one. Jealousy, Sinha ought to know, is a most wasteful emotion.    

Fake news    

One, the Modi Sarkar will soon make it mandatory for every adult Indian to tattoo the Aadhar number on his right forearm and PAN on his left while the GST number is to be tattooed on the forehead.

Two, when Rahul Gandhi last met Sachin Tendulkar he commiserated with him, saying that  that though he was senior his name did not figure in the national anthem while Dravid’s did. And he promised to make suitable amends once he became prime minister.

A Freudian slip, this?

One of the several companies of Karthi Chidambaram under the CBI-ED scanner is named Advantage Strategic Consulting Pvt Limited. Pray, what advantage was he advertising other than the fact that he was P Chidambaram’s son?

 

 

 

(Virendra Kapoor is a senior journalist and columnist. The views expressed here are his own and do not reflect that of Asianet Newsable.)

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