Here
we reproduce a
slightly edited version of the intervention made by Sitaram
Yechury, leader of
the CPI(M) group in Rajya Sabha, on December 7, 2011, during
a discussion in
the house on the issue of price rise. Subheadings have been
added.
HERE I
would like to point
out that this is the third time that there is a discussion on
price rise, i.e.
in the third session in a row. There was a discussion first when
the honourable
chairman moved a resolution --- and we all supported that
resolution --- where
it was said in the last sentence that the government would take
some steps to
protect the people from inflation. Thus the people were supposed
to be given
some respite from inflation, but they didn’t get any. There was
again a
discussion in the next session when the opposition moved a
resolution, and we
wanted some amendments to it. There too it was said that the
government would
take all possible steps to curb inflation, but none were taken.
This time we
wanted a discussion under Rule 168, so that there is a voting on
it, and thus
there is some pressure upon the government. But the sad thing is
that there is
no such pressure today. However, I think that the government
must take some
steps on moral grounds, because of the commitments it has made
to the people.
SORDID
REALITY
In this
regard, I may
suggest three solid steps which the government may take, but
before it some
discussion on the existing reality is needed. The food inflation
crossed 20 per
cent mark during the last two years; even today it is above the
12 per cent
mark. Vegetables are costlier by 26 per cent today, pulses by 14
per cent,
fruits by 12 per cent, eggs, fish and meat by 13 per cent and
milk by 12 per
cent. But when comes the question of why it is happening at all,
we are told
that the income of the people has gone up. The finance minister
said so; the
prime minister too said so when he was returning after taking
part in the G-20
meeting. I quote what he had said, “If the economy is growing at
8 per cent and
the population at 1.6 per cent, the per capita income must be
growing at 6.5 to
6.7 per cent.” And what did the finance minister say when he
made an 11-page
statement at the beginning of that session? He said, “The steady
rise in the
incomes of our people is creating an excessive demand and that
is the reason
for this price rise. There is a mismatch between supply and
demand.”
Now, what
is the reality? The
Economic Survey informs us. I quote, “The growth of private
final consumption
expenditure fell from 8.6 per cent in 2005-06 to 7.3 per cent in
2010-11.” And
what is the other reality before us? You say that the actual
incomes have
grown. But what does today’s Times of
India say? It tells something on the basis of the
Organisation of Economic
Cooperation and Development (OECD)? This OECD is a holy cow for
globalisation
and a mantra for all
the PPPs. Its
report about India
has been published today, and I quote, “The top 10 per cent wage
earners now make
12 times more than the bottom 10 per cent, up from a ratio of 6
in the 1960s.” It
further says, “The top 10 per cent earners make 5 times more
than the median 10
per cent but this median 10 per cent makes just 0.4 times more
than the bottom
10 per cent.”
What is
happening? If the
income has increased, it is going to a few hands and thus “two Indias”
are
being created. We have said here many times that there is one
shining India
and there is another suffering India. The
suffering India
is growing
in number and the more its suffers, the more the other India
shines. Our
Rajiv Shukla is not here, otherwise I would have said to his
liking --- he is a
great avid cricket fan --- that there is an IPL India and the
BPL India. These
are the two Indias
that have been created.
Therefore
the question is:
If the incomes are growing, whose incomes are growing and by
what methods? We
need to note that the common people’s income is not growing, but
yet they are
suffering because of the rising prices. What needs to be done
for them? I hope
the finance minister, having been associated with the finance
ministry for a
long time, will understand that inflation is a classic mechanism
of income
redistribution, as any economist would tell you. It is income
redistribution
from the wage earners to profit earners. That is what exactly is
happening in
our country today. You are creating a chasm between “two Indias”
and on
top of it there is this price rise of the dimension that I was
telling you.
That is creating agony for the aam aadmi
today.
So what
the common man
wants is relief. We need not make the shining India
more shining. Rather, India cannot
shine until the common man begins to shine. Otherwise, India
would shine but
not the Bharat.
NEED TO BAN
FORWARD TRADING
So, what
are the three
steps needed? First, we think it is speculative trade which is
worsening the
situation of inflation. And let me add that today it is only
rice and urad in
which forward trading is
prohibited. What do the latest data from the Commodities
Exchange, from the
Forwards Markets Commission headquartered at Mumbai are telling?
That in the
period from April 1 to October 31, 2011, the cumulative value of
trade has gone
up by Rs 1,06,36,960.76 crore. That means it has grown by 72.63
per cent in a
few months. But if you take the agricultural commodities as a
whole, the trade
has grown to more than Rs 10,83,000 crore; in percentage terms,
forward trading
in agricultural commodities was nearly 54 per cent during this
period. If there
is so much of growth in the value of forward trading, what does
it mean? Nobody
will invest in forward trading unless there is profit. But if
the prices do not
rise, those who speculate in forward trading do not make any
profit. So the
pressure for prices to rise is automatically there when you have
this sort of a
cumulative value in this forward or speculative trading.
Thus the
first needed step
is that you ban all forward trading, all speculative trading in
agricultural
commodities, and ban it for every single commodity. There will
be some problem,
as foreign finance capital will start shouting as to what you
are doing. But
this would be in the common man’s interest. The government can
check the
efficacy of this step by suspending the forward trading for six
months. If the
prices don’t come down, we are prepared to accept your word.
Corruption
has a link with
forward trading. Where all this money comes from? Where is it
going? How much
black money is being generated? All this is related to
speculation.
PETRO-PRODUCT PRICES
ILLOGICALLY RAISED
Secondly,
you say that the
rice of petrol has been reduced by 2 rupees while the crude
price has gone up
by 3 dollars a barrel. The logic up to now was that
petro-product prices were
going up because the crude prices were going up. Now you have
reduced it while
the crude prices abroad are going up. Yet you are not prepared
to accept that
the two sets of prices are unrelated. You say that oil companies
are suffering
from under-invoicing of Rs 1.32 lakh crore. But you don’t decide
the prices on
the basis of the production cost; in fact you show
under-invoicing by linking
the petro-product prices to international crude prices. On the
basis of this
supposed under-invoicing, you say that oil companies are facing
losses. But,
according to the audited accounts till March 31, 2010, the net
profit of the
Indian Oil Corporation was Rs 10,998 crore. It is the net profit
after paying
taxes. The reserved revenue surplus of the India Oil Corporation
was Rs 49,472
crore. During April to December 2010, two other major oil
companies, the
Hindustan Petroleum and the Bharat Petroleum, earned profits of
Rs 544 crore
and Rs 834 crore respectively.
But if
these companies are
earning profits, the people must get some relief, or not? Nobody
understands
why you are raising the prices of petro-products. On the other
hand, you say
you are giving a subsidy of Rs 40,000 crore on petro-products.
What is
the amount of
money earned by the government of India in 2010-11? The reply
given by the
finance minister to a question in parliament on November 22 was
that in
2010-11, the total amount, through indirect taxes collected and
realised, was
to the tune of Rs 1.02,827.77 crore. In addition, they got a
dividend and
royalties from oil companies to the tune of Rs 22,240.47 crore.
As the finance
minister says, sector-wise data of direct taxes, personal tax
and corporate
tax, are not maintained centrally. But if you add that too, the
revenue would
go up to more than Rs 1,30,000 crore. The subsidy you are giving
to the people,
you say, is Rs 40,000 crore. But in fact the people are
subsidising the
government. You are making a profit of Rs 90,000 crore from the
petroleum sector,
and still you claim that raising the prices is necessary. Is it
justified? We
say: the simple solution is that you roll back the prices.
It is
good that the
government has retraced its step on the retail trade issue,
otherwise this
winter session would have gone waste, just as the last year’s
winter session
went waste.
NEED TO STOP
SUBSIDISING THE RICH
The third
step needed is
related to foodgrains. Today, our central godowns have a stock
of more than 600
lakh tonnes. This is more than two and a half times of the stock
needed
according to the buffer norms. Why? For the mice? I ask: why
don’t you give
these grains to states at BPL prices? In that case, they would
be distributed
through the public distribution system, which would have some
impact on the
price situation.
These are
the three steps
needed. First, impose a total ban on speculative trading.
Second, roll back the
petro-product prices. Third, release the excess foodgrains for
distribution
through the public distribution system. We think there would be
some control on
escalating prices if the government takes these three steps.
Right
now, there is no
pressure upon the government as the discussion would be without
any voting. But
we want that the common man must exercise pressure upon the
government.
In the
end, I would only
say that the tax concessions given to the rich in the last
budget were 5.12 lakh
crore. But if only that were not given, there would have been no
fiscal deficit
in the country. However, amusingly, the concessions to the rich
are called
incentives and those to the poor are called subsidies! And they
say that subsidies
are bad for the economy while incentives are good!! Is it a
government of the aam
aadmi or of the khaas aadmi? We say: give concessions to the
people rather than to
the rich. I only urge the government to seriously consider these
three
measures, even if there is no voting today, and start
implementing them in the
interest of the people of this country.
(Reproduced from "People's Democracy" 18th December 2011 issue)
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కామెంట్ను పోస్ట్ చేయండి