The New Nation - Internet Edition

Hem Raj Jain

The Paragraph 38. 'Flagship Programmes' of Indian budget 2008-09 reads "[National Rural Employment Guarantee Scheme (NREGS) will be rolled out to all 596 rural districts in India. Initially, we will provide Rs. 16,000 Crore (160 Billion). Let there be no apprehension in any one's mind; as demand rises, more money will be provided to meet the legal guarantee of employment]".

This is a cruel & crude joke as given below on the most deprived (rural unemployed / underemployed) and mute section of fully civilian democratic India (which in this budget gave liberal benefits, in view of coming elections, to every vocal section of society including loan waiver of Rs. 60,000 Crore to farmers, income tax benefits to affluent service class, customs, CST, & excise duty cuts to businessmen & industrialists etc.) and which justifies diarchal democracy in Pakistan if it assumes additional martial jurisdiction of human rights (including basic human right of livelihood) with the Center in addition to its traditional jurisdictions of defense, internal security, assent to legislation etc in tandem with civil jurisdiction with elected State politicians: -

(1)- No sensible person in India including Governments of India (GOI) and its States believe that 8-10 % consistent GDP growth rate (which, as presently will always benefit only a small segment of Indian population and that too is now uncertain in the backdrop of US recession) will automatically solve the problem of large scale unemployment / underemployment of India due to trickle down effect. What to talk of short term, even after a decade or more (which India does not have politically) of such GDP growth, it will not percolate to a grass root level where burning unemployment / underemployment problem of India can have any respite worth the name.

(2)- Hence NREGS started from Feb 2006 in 200 districts. For financial year 2006-2007 budgetary support for NREGA was Rs. 11,300 Crore. Last year this scheme was in 330 districts of India and for 100 days for one spouse. But as per contingent provisions of NREG Act and assurance given in Parliament it is going to be for 300 working days by 2010 for both the spouses.

(3)- But as per media, the recent report by Comptroller & Auditor General of India found that only 18 days of employment was available as against a target of 100 days while only 3.2 percent of all registered households could avail of this scheme.

(4)- By granting merely 16,000 Crore this year in budget, Government of India (GOI) has increased only 4,700 Crore over 11,300 Crore. That means neither 100 days work is expected be given to job seekers in enhanced number of districts nor GOI wants all 100 % registered households to avail of this scheme.

(5)- In view of CAG report, it is evident that GOI through inefficient implementation of NREGS is not meeting the demand of employment by job seekers. But GOI could issue such callous budget statement that "as demand rises, more money will be provided" without realizing that raised demand is already there. This tantamount taking excuse of its own inefficiency to deny seriousness & adequate funds to NREGS, hence deliberate denial of employment by GOI to large poor population of India.

(6)- Even with present offer, NREGS is going to employ about 90 million unskilled Indians (if present government data for only 330, districts available on the website of Ministry of Rural Development is any indication - Andhra Pradesh with 42 M.P. employed 3.8 Millions hence India with 543 M.P. ought to employ 50 Millions) and with 596 districts with even slight improvement in job availability 90 million job seekers are bound to be there.

(7)- For these 90 Million people the wages itself at Rs. 60 per day of statutory minimum wages for 100 working days will cost 54,000 Crore (540 Billion) - [If merely soil digging and filling is not to be carried out and assets are to be created in NREGS for giving boost to revenue generation then of course cost will go up tremendously].

(8)- There is a huge difference between Rs. 540 Billion and Rs. 160 Billion and which can not be bridged by such misleading budget statement that "as demand rises, more money will be provided". Therefore GOI should categorically make a budgetary provision of Rs. 540 Billion for NREGS so that not only financial implication of NREGS in its present form (and also in future form when NREGS will be implemented fully within another two years where it will employ both the spouses for 300 hundred working days) are realized by the people of India but also GOI becomes aware of its responsibility to ensure the efficient implementation of NREGS so that this scheme, as per the letter and spirit of the law, can ultimate provide guarantee of bare minimum sustenance to needy almost half of India.

(9)- This Rs. 540 Billion for NREGS (and future heavy expenditure) is not difficult to mobilize if GOI confine itself to its jurisdictions of defense, internal security, human rights of livelihood through NREGS etc and leaves all other jurisdiction (like agriculture, health, education, infrastructure - roads, power, etc.) which Center has unnecessarily usurped and is still trying to further usurp from the States in utter disregard to the principles of federalism and which has sapped the initiative & dynamism from the States.

(10)- Moreover GOI has to be further careful. Though through Fiscal Responsibility and Budget Management Act, GOI is trying to give an impression that it is not resorting to impermissibly high fiscal deficits but GOI (and States) should know that their debts are in violation of Article 292 & 293 of The Constitution of India. Because GOI and States have incurred debts beyond the security (worth) of their consolidated funds as is evident from the heavy interest (revenue expenditure) they are paying on these debts. Therefore GOI should avoid being profligate as it has been during this budget by spending on usurped jurisdictions and by indulging in charity to farmers etc. and save its money for NREGS, which is its statutory responsibility.

[The way GOI has handled interest on loan (which once went even above 18 percent per year), has been nothing short of scandal. One need not be Islamite to realize the importance of low interest rates. Even up to fifties money was easily available to businessmen at Annas 6 (Rupee 1 = 16 Annas) against hundis (traditional promissory notes) which brings interest at Rs 4.50 per year. Therefore there is no reason why money should not be made available to every body and not merely to farmers at Rs. 4.50 per year by passing a suitable legislation unless GOI wants India to become a nation of high interest seekers (byajkhor)].

(11)- GOI should also desist from portraying farmers as weaker section of society. With NREGS in place, no body is weak in India. Under misconceptions about socialism, India tried to give & romanticize small land pieces to people which resulted in uneconomical land holdings and which is the main reason for the problems of most of these farmers. There is no reason why these small farmers cannot become the part of NREGS if they invariably find it difficult to pay back their loans.

(12)- If farmers (who are comparatively more powerful politically than most of the unskilled workers being engaged in NREGS) on finding their holdings economically untenable join NREGS in large numbers then NREGS will not remain merely a social welfare program for unskilled jobless workers (as is being taken by most, hence matter of neglect by GOI) but will be utilized for creating assets with the help of semiskilled / skilled workers and material needed for such assets and which will make it an integral and important part of Indian economy.

(13)- India since independence has been deriding Pakistan for being politically subservient to USA but now the way India is treating NREGS (which tantamount to India becoming 50% communist as GOI will sustain half of India through NREGS) it raises reasonable suspicion that India has become economically subservient to USA which will do every thing to ensure full capitalism in India especially with such huge foreign investment in India. In this exercise USA has rightly counted on hard-core capitalist economists like Manmohan, Chidambaram, Ahluwalia (Prime Minister, Finance Minister, Dy. Chairman Planning Commission).