In April 2014, BJP came out with its vision for a new India. The electorate tired of UPA governance for the decade preceding it, gave Modi a chance to change things.
These are a series of articles that go point by point on promises made by BJP while in opposition and its score to fulfil it while in power.
Part 1 : Price Rise
In 2014, the food inflation has crippled household budgets and contributed to the overall inflationary trend. The ballooning government deficits because of subsidies failed to help the common man and may have been the single biggest reason for UPA’s loss.
While the inflation was result of easy money floating around the world at the time, coupled with highest ever petroleum prices, UPA did contribute to it by mismanaging it completely.
BJP however thought there were institutional ways of solving the problem.
Proposals by BJP
- Put in place strict measures and Special Courts to stop hoarding and black marketing.
- Setting up a Price Stabilisation Fund.
- Unbundle FCI operations into procurement, storage and distribution for greater efficiency.
- Leverage on technology to disseminate Real time data, especially to farmers – on production, Prices, imports, stocks and overall availability.
- Evolve a single ‘National Agriculture Market‘.
- Promote and support area specific crops and vegetables linked to food habits of the people
The intent and action on the promise
Special Courts to stop hoarding and black marketing.
Central government has done little to stop hoarding and black marketing. Even after the BJP suffered from unexpected price rise just before Bihar elections, due to hoarding and black marketing, the party with a difference did little to put any sort of strict measures.
Even the black marketers who were booked by central agencies just after the Bihar election have had their trials going on and on. Forget about Special courts, the cases were not even fats tracked.
Price Stabilisation Fund.
This was envisioned as a fund from which emergency subsidies can be released without causing fiscal deficit. Every Indian household understands the importance of having such a fund for a rainy day. However, just as the international crude prices fell and government eased out of its subsidy burden, the possibility that things can go down south was again forgotten. While Modi government did a marvelous job of containing the subsidy bleeding, it has – as yet – failed to show any intent to have a Price Stabilization Fund in any form.
Unbundle FCI operations
Food corporation on India is arguably one of the least efficient organisations of its scale in the whole world. Every aspect of its operation needs an overhaul and every successive government in last 30 years has known about it. To its credit Government did set up a high level committee under Shata Kumar in 2014, which reported with sectoral reform needs within a year. While the government has addressed the PDS leakages with direct Debit, absolutely no movement has been done on the working of FCI itself. the Budgetary proposals of 2018 actually propose a greater role for this leaky bucket without any change in its operations or organisation.
Leverage on technology to disseminate Real time data
The Prime Minister can claim substantial progress on this account. Quite a few Mandis have been digitized and data is available to farmers in real time. However its not a done deal. Framers have no knowledge of how to access and use this data. The lack of this knowledge has created a new generation of profiteering middle men. Savvy with technology, they are on their way of becoming ‘farmer aggregators’ and are just replacing (or at times upgrading) the older generation of middle men.
National Agriculture Market
This should have had been the next level of technology to disseminate Real time data. Once all mandis were connected, they should have had created National Agricultural Market. As with other tall promises of BJP that made immense sense in 2014, this too remains a work in progress with almost no intention of completion.
Promote and support area specific crops and vegetables
There has been absolutely no effort in this regard. The food diversity is of utmost importance to both the food security and the nutritional security of country. The government polocies of pushing for a common market by means of FCI subsidies has been destroying this for over three decades. If done properly it could solve problems that are beyound just technical in nature. Imagine if government pushed farmers of Cauvery delta to switch to crops that are not as water intensive as rice, it could have improved both the productivity and solved a water crisis that invariable ends up in Supreme Court every few years.
In effect BJP led government in center has no new instrument to handle an overnight price rise of crude or for that matter of any other essential commodity and in such an eventuality would scramble much like the UPA government before it using RBI’s interest rate, import/export controls etc.
We would like to give a meager 4/10 to BJP in its action vs promise. Please do let us know if you disagree, we would love to revise our ratings at the same time hope that in the year ahead government does a course correction.