News 9

News 9

This NYAY card gives hopes, to 2019 elections

Friday, 5th April,

Aurangabad

 

                   Just look around - some of the richest free market economies also run the most powerful welfare programmes so there is no contradiction, in fact, there is organic chemistry between the two so seriously, can NYAY be funded without throwing the fiscal deficit out of whack? while the Congress has yet to enumerate the blueprint. This is just one iteration several variants will be possible, to begin with, everything will not happen on day one. So if we assume that the rollout will be across 10 20 30 and 40% of the districts over years 1 through 4. Cash needed on year 1 is 36,000 crores on year 2 is 1,08,000 on year 3 is 2,16,000 and on year 4 is 3,60,000 crores respectively. 

                 

                  There are two existing schemes which can justifiably be tweaked to realign them with NYAY. The first one is the food subsidy programme which is already budgeted at 1,84,000 crores. Now that today covers 67% of the population Since per capita incomes have risen substantially its coverage can be reduced to 50% Now that would release almost 50,000 crores rupees for NYAY. Also, MNREGA could guarantee 150 days per year and that's up from the current 100 days of employment to an NYAY beneficiary Just these two tweaks could take care of the first 18 months without adding a penny to the fiscal deficit. There are estimates that a tiny 1% wealth tax on households with assets of more than 2.50 crores rupees - just 0.1% of India's households  - could raise over 1 lakh crore rupees and finally there is economic growth cover the rest. Remember India's GDP is expected to grow from Rs 2 lakh crores to 3.5 to 4 lakh crores over the next 4-5 years. Just that would garner the additional tax revenue required to fund NYAY. That would keep the fiscal deficit at prudent levels. So, the key is massive de-regulation to achieve double digits economic growth. Rahul Gandhi should also launch the final assault on India's draconian-ly regulated economy. That is the flip side of the NYAY. To undertake massive governance reforms such that entrepreneurship and wealth creation flourish. Nearly 90% of our GDP is produced in private enterprises but it horribly strangled in red tape. Why don't we allow corporate restructuring via contracts as happens in several countries of the world which can be wrapped up in weeks? Why do our entrepreneurs have to waste years in court paying ridiculously high legal fees? Why do we have contradictory guidelines that force companies to violate one regulator or another?