Consensus vs.Control

More than 10 million citizens gave up their claims over cooking gas subsidy since Prime Minister Narendra Modi’s appeal at Urja Sangam conclave on March 27 last year. It is reported that 97% of them belong to middle class or lower class. About 50% of them belong to Uttar Pradesh, Delhi, Karnataka, Maharashtra and Tamil Nadu. Most of them are teachers, government employees, bank executives and retired people. They have limited means and they get rattled by even a Re 1 per unit hike in food prices like milk, egg or vegetables. Why did they give up more than Rs 1,200 per year subsidy? Because the decision was not forced on them. This should be the lesson for policy makers. Success of any policy decision lies on its acceptance by the people. Forced odd-even is as unacceptable as excise duty on jewellers. Build consensus for effective governance. After all, the government represents the people.

(Also published in Hindi @ Amar Ujala, Apr 25, 2016, p. 11.

Hoarders, Beware!

Positive vital statistics last week created an atmosphere of exuberance and hope for both rural and urban economies. Latest data showed a 2% positive growth in industrial activities and a drop in retail inflation. Sensex also crossed 25K in just three trading sessions last week in anticipation of good days ahead. All these developments have one common trigger; India will get a good monsoon after two years. According to the Indian Meteorological Department (IMD), the country is expected to get above normal monsoon. What will be its impact? This is an alarm bell for such unscrupulous traders who are hoarding food grains to jack up rates for profiteering. After good monsoon food prices will fall. Fearing this, hoarders will be forced to bring out grains from their godowns. Food prices of most of the edible items, barring import dependent pulses, are expected to soften soon.

(English version of ArthBodh column published in Amar Ujala, Apr 18, 2016 )