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THE Tribune interview |
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Punjab’s indebtedness and its write-off
Media Adviser to the Punjab Chief Minister, Harcharan Bains, writes an open letter to
Manpreet Singh Badal, former Finance Minister
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THE Tribune interview
Excerpts: What are the current and future threats to India? Is the Army ready with a long-term defensive and offensive plan to tackle them? We are preparing ourselves to operate in the entire spectrum. So far as the conventional operations are concerned, whether it is conventional with a nuclear backdrop or low intensity, something which is akin to proxy war border skirmishes, we are prepared for everything. As far as the non-conventional threats are concerned like cyber warfare, meddling with what we term as global commerce, those are areas which are receiving due attention. We are looking at what we can create in terms of organisation which can address them even better than what we are doing today. Where internal dissent and those issues are concerned which basically are socio-economic in nature or which are law and order where at times you get called in, we are also looking at that in conjunction with what we can do with other organs of the state which will help us in meeting these
challenges. The Air Force chief described the situation in the neighbourhood as volcanic. Do you agree? I do not want to comment on what he said. What I look at it is that we have an unstable neighbour on our West (Pakistan). Unstable because of internal problems, unabated terrorism out there and unstable because it decided that it will aid some terrorists groups and support some terrorist groups for strategic aims because of political drift and the fissures that are coming up because of all these factors. And we also know that whenever situation become critical with this particular neighbour of ours it tends to direct attention of its people towards India. There is instability; there is a terrorist infrastructure which is in place. Till that time the threat to our country will remain because it looks at dismembering the country as a nation. We also have the so-called border problem because of what happened after 1948. So far as China is concerned, yes, it is developing infrastructure, developing its military but at the same time the borders are comparatively peaceful. You have confidence-building measures in place and there is a fair amount of understanding in ensuring peace and tranquility. However, intentions in this case can change as the capabilities grow. We take note of both these developments and I think we are prepared to meet the type of threats that may erupt. I think all the three services are on the same grid so far as this issue is
concerned. There is also a nuclear dimension with Pakistan having acquired the capability as well? We have been looking on this threat for quite sometime. It is not that suddenly it has come, we knew at the capabilities of our neighbourhood and what was happening over there and we have been talking about it, we have been training for it and we have been looking at our own concepts and doctrine etc so far as this particular issue is concerned. As an Army, we are prepared to fight dirty which means not dirty in the sense of street fighting, dirty in the sense of fighting through our area which has been contaminated by a nuclear strike. We are confident that we will get through in such contaminated areas and this is part of our training methodology, doctrine and our concept. It is not that somebody is going to say I will drop a bomb and therefore you stop on your track. Sorry, it does not happen that way, it is not going to happen. We will take the war to its logical conclusion whether it is a nuclear strike or no nuclear strike. I am quite confident of our nuclear capability. We are clear that as a nation we will be able to withstand whatever comes our way and retaliate in adequate measure. China is ramping up infrastructure along its side of the border with India and there has been talk of intrusions. Do you think India is doing enough to counter any threat the Chinese may pose? I would answer the question in two parts. Firstly, yes, there is lot of infrastructural development in Tibet autonomous region and China has enhanced its capability in that region. But there is no enhancement of military force for which we should get worried. Yes, China is a country which is progressing very well economically and obviously when you are doing great amount of economic progress, certain benefits go in modernisation of the military like any other nation would do. Because we have a disputed border, there will always be a concern that intentions can change. And there is a second point. At the moment, the borders are peaceful. There are confidence-building measures in place. There is a system of holding border personnel meetings. There is a system of hot lines so that unnecessarily things do not go out of control. And they are functioning pretty well. I think at times things get unnecessarily blown up. There are no intrusions. There are transgressions. Transgressions are in areas where a certain alignment is disputed between the two countries. You feel that the alignment should be at a particular place and you go up to that place. They feel that alignment should be at a particular place, so he comes up to that place. Therefore, for him you have transgressed and for you, he has transgressed. That is what all is happening. There is nothing very alarming about it. As a person who heads the Army, I find there is no problem on our borders. We are ensuring that whatever are our national interests, they are guarded properly. There is no alarm on this matter at all. And I think China also knows it. That is how confidence-building measures are coming into place. For the Army, there has been a problem of acquisition of new armament or upgradation of existing equipment especially after the Bofors controversy with every government since then wary of taking decisions about defence purchases. Is the Army facing the same problem of obsolescence as the Air Force is? This is a perception. Obsolete to what? There are certain things which probably have outlived their lifespan in terms of equipment that came or got inducted at a particular time. Such equipment is still worthwhile because of what you have in your neighbourhood. Yes, acquisitions suffered in the wake of Bofors thing that came up and everybody is too cautious for the simple reason that nobody wants to get into the vigilance net. The Defence procurement procedure policy that has been laid down now is quite good and it is getting updated as we keep having interactions with the industry and all other people who work in it. Two things have to be maintained in procurement — one is transparency and the second is to ensure that nobody can cast a doubt which usually happens when there is a large amount involved. I feel that if we are convinced that a thing is needed, it is necessary or if there is an urgent requirement for it we should be able to remove the cobwebs that come in the way. I am confident that this will happen and I have seen it happening. We have a very supportive political leadership so far as this issue is concerned. I am looking at faster acquisitions. But let me also sound a word of caution. What you acquire from abroad and what can be made indigenously, we need to have a balance. You cannot be dependent on too much from outside because then you become a hostage in times of a need. So there is a great amount of effort that is being made to ensure that our own private sector comes up in this field. We would like our private sector to come up whether they make a joint venture with somebody outside or what they want to do is there problem. But at least there should be technology infusion by which they can match up to what we require and maybe we will see that over a period of time the type of vibrant industry that we have, that is our strength in the economic marvel that has happened, it should be able to take on lot of jobs. What are the technologies or equipment the Army needs to acquire to face future challenges? We are ready to face the challenges that may come up. There are certain focus areas that we have kept for ourselves. Like we are looking at the type of surveillance equipment that can come, we look at our capability to do 24x7 operations where night is not a problem. We are looking at improving our networks centricity. We are looking at high technology items in terms of computer controlled and command controlled systems which provide synergy to the entire process. Some of these are on way and some are these are being given a push. The other area that we are looking is our capability for bringing in precision targeting. There has been demands to modify or amend the Armed Forces Special Powers Act (AFSPA) especially in Kashmir. What are your views on it? Kashmir is a complex problem. Like I have said, we had created a situation which should have been made use of. Somewhere, some problems have occurred and I will not go into why and how of it. I think you all are aware of what is happening out there. We as the Army, have done a tremendous job out there. Even in the period of crisis you have seen that the rural areas where the Army mainly is have remained quiet. They have not supported agitations and whatever goodwill that we have earned is reflected in the way people respond to us. I am sure this will be visible to everybody and they can find the windows which they can utilise for betterment of the situation. AFSPA is an enabling provision and Act passed by Parliament. It assists the armed forces in dealing with special situations. It does not give it unwieldy powers because when the Supreme Court reviewed it, it looked at it very critically and came to a decision that this is not an arbitrary act. It has got a meaning. It enables your forces to have a certain amount of legal cover. They also said that we should have certain guidelines which have been given to the Army. The Army by itself had already taken out certain commandments that the troops must follow as additional guidelines. Troops who operate in to such areas are actually not aware of AFSPA. They are operating under the guidelines given by the Army. And those guidelines are very explicit. They tell you what to do what not to do. And where aberration occur, we come down hard upon those people. So there is no misuse. I don’t think there is a need to dilute the Act. What about action against violators? We have human rights organisations in our service. Each case is investigated. Let me tell you 96 per cent of the cases are found to be false and we go back to the National Human Rights Commission and tell them that’s what it is. Where there is a violation we take very quick action and ensure that adequate punishment is given to these people. The Army does it in much faster time frame, even faster than a fast track court because we are concerned about our own image. We are not an occupation Army in anyway. Do you see a role for the Indian Army in Afghanistan? Afghanistan has been a country that India has been engaged with for a long time. Because of our age-old relationships, all our aid is developmental and humanitarian. We have looked at ensuring that there is development in Afghanistan and we have looked at progress in Afghanistan. But we have not looked at militarily involving ourselves in Afghanistan. And that stance continues. We do not look at the Army stepping in any way and we are not recommending it to do so. Our government has chalked out a policy on Afghanistan that is absolutely correct. It ensures that whatever interest we have is fulfilled. What would be your focus during your tenure as chief? We have embarked on a transformation process for our Army. Transformation is in terms of making the Army more agile, the Army more capable of transmitting its lethality and the Army in which there are no people who will be, in Army terms, left out of battle. Apart from that it is having a more responsive logistic system and ensuring that our Army headquarters are suitably structured so that they can contribute towards faster decision-making. This is what I think we should be able to achieve along with ensuring that whatever modernisation plans that we have they fructify to a large extent. I look at what we can do to increase our joint-manship network centricity so that we can operate in an environment where it should be possible for us to make use of all the acumen and skills that all the services we have.
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Punjab’s indebtedness and its write-off
Normally such Centre-State issues go to constitutional bodies like the Finance Commission or some other apex committee. The Twelfth Finance Commission had examined the issue of states' indebtedness in depth and recommended “debt relief in the form of debt consolidation and debt write-off”. The Twelfth Finance Commission also made repayments due from states during the period 2005-2006 to 2009-2010 eligible for write-off and the quantum of write-off was linked to the absolute amount by which the revenue deficit was reduced. It was also envisaged that if a state was able to bring down its revenue deficit to zero by 2008-09, the targeted year as per the Fiscal Responsibility and Budget Management Act (FRBMA), “the entire repayments due from the state during the Twelfth Finance Commission award period would be written off”. However, because of its casual approach, Punjab could not make use of this offer. On the other hand, Punjab's revenue deficit in 2008-09 swelled to nearly 3.0 per cent. But then, the preconditions or suggestions made by the Union Finance Minister (as reported in The Tribune, October 3, 2010) merit serious consideration. The most crucial and controversial suggestion relates to subsidies in general and power subsidy to agricultural sector in particular. Since subsidies have some social and economic costs, while granting subsidies utmost care should be taken so that these serve some useful socio-economic objectives. If benefits outweigh socio-economic costs, only then subsidies are justified, otherwise not. Subsidies should be recommended only if they add to total agricultural production, or induce the desirable shifts in cropping pattern (as was in mid-sixties), or reduce poverty and inequities, or fulfill some other socio-economic objectives. No doubt, the economic conditions of farming community in general and that of small and marginal farmers in particular are most vulnerable. But the answer lies not in providing them freebies, which lead to economic inefficiency and wastage in the use of scarce resources. Even charging flat rates for any public service would lead to economic wastage. Unfortunately, illusory political considerations weigh more in the minds of our policymakers than the predictable socio-economic gains. This has deprived the state bureaucracy of necessary motivation to work for the economic salvation of Punjab which is going down the economic ladder. Of the bigger states, while Gujarat, Maharashtra and Haryana have already gone higher than Punjab, lately Kerala, too, has marched ahead. In respect of other states like Andhra Pradesh, Karnataka, Himachal Pradesh, Tamil Nadu and West Bengal, the difference is sharply narrowing. During the Tenth Plan period, Punjab grew at 5.0 per cent compared with the all-India average of 8.0 per cent. Another suggestion (read not condition) made by the Centre to “bring various collections made by boards and other government agencies under the consolidated fund of the state”, should be seen in the light of wider misuse of such funds. There are certain government agencies like Punjab Mandi Board, which collect more than Rs 2,000 crore in the form of market fees (Rs 650 crore), rural development fund (Rs 650 crore) and infrastructure development cess (above Rs 700 crore). If such collections like other receipts go to the consolidated fund of the state, its use will form part of the state budget. This will ensure greater transparency in their usage and also bring down the revenue deficit and fiscal deficit, thereby enabling the state to claim debt write-off. Measures such as the introduction of change-in-land-use charges and hike in irrigation and other user charges are simply required to boost revenue of the state. In view of the ever-increasing revenue deficit, Punjab needs to exploit emerging sources of revenue. Many states have levied 'Green tax' on vehicles to ensure a pollution-free environment. Even old motor vehicles whose registration has expired can be re-registered to harness state revenue. There is also a need to mobilise resources from non-tax sources by conducting an item-by-item study. Public expenditure, too, needs scrutiny to avoid wastage. Coming to another suggestion to introduce property tax in urban areas, it needs to be emphasised that it is a precondition for urban local bodies to avail themselves of 90 per cent Central assistance for urban development under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) for which the Government of India has set apart Rs 1,00,000 crore for seven years beginning 2005-06. Except for one or two years, Punjab could not avail itself of this Central assistance as it failed to contribute its meager share of 10 per cent. Haryana has already levied the property tax and thereby made the full use of Central assistance. If the Centre finances a major chunk of urban services, it should have the legitimate right to see its proper use through its own agencies like the Comptroller and Auditor-General. Otherwise, it should not transgress the state’s territory. To debar premature withdrawal of provident fund by the employees, it is the duty of the Central Government to incorporate such changes in the provident fund laws. To discourage the premature withdrawals, let the Centre apply the Exempt Exempt Tax (EET) principle as envisaged in the first draft of the Direct Tax Code. Otherwise, only final withdrawals at the time of superannuation should be allowed and made tax-free. There is no doubt that fiscal management in Punjab is in a mess. And the conditions have deteriorated over time. No doubt, of all the states in India, the proportion of revenue receipts spent on interest payments is the highest for Punjab. But little is done to rein in unproductive expenditure or to mobilise the required additional resources. All states which have outperformed Punjab have learnt the importance of raising resources and managing them efficiently. The tax-income ratio in Punjab is much below the national average and in respect of per capita tax, it occupies the ninth position compared with the earlier top most position (just like the income status). Since the state has less than one-and-a-half years to go for the general election, it is futile to expect drastic changes on the fiscal front. However, all political parties and stakeholders should sit and form some consensus to find ways to regain Punjab’s lost glory before it is too late. The writer is a former Professor and UGC Emeritus Fellow, Department
of Economics, Punjabi University, Patiala
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Media Adviser to the Punjab Chief Minister, Harcharan Bains, writes an open letter to
Manpreet Singh Badal, former Finance Minister My dear Manpreet, I
WRITE this not as a friend with whom you used to exchange midnight messages on poetry but as a soul devastated by the recent events. It has been my painful destiny to be witness to a completely unquestioning affection and trust from one side and persistent and brutal stabbings on the body and soul of a man whom I worship as a saint-statesman, from the other. I refer to Parkash Singh Badal, till recently your revered Tayaji but now a mere “My dear Chief Minister” as you have addressed him in your letter delivered to him through the media. He no longer deserves to be addressed even as “Respected Chief Minister!” Despite this tearing pain in my heart, I have enjoyed your beautiful melancholy songs of injured innocence on “gag orders” against you. We share more than our artistic tastes…. But “gag orders” against you and your voice being stifled? For three and a half years, the only thunder and clap Punjab has been hearing against the SAD-BJP government is the deceptively honeyed voice in which you gleefully and openly rubbished the policies and performance of your “Tayaji’s” government. Ironically, there have been “gag orders” slapped on the whole party, particularly its embattled president, Sukhbir, who claims that there is love and affection between you and him while you more truthfully rebuff him by saying that “we have never sat together.” No one has ever been allowed by your “dear Chief Minster” to utter a word against you or your department or anyone of your decisions. Poor Sukhbir! He must be the only party president in the world not to have even the right to ask his party men to refrain from speaking against the party and its government in the media! Clearly, in “Sukhbir Akali Dal”, Sukhbir's is the only mouth gagged, all because some of his party men enjoy more affection and trust of “My dear Chief Minister” than he (Sukhbir) does. But about the issues raised by you, Manpreet, is it not a fact that Badal repeatedly asked you to place your views on issues like subsidies before the Cabinet, before the core committee and other party and government forums — everywhere except the media? Is it not a fact that he most affectionately said to you on the eve of the Shimla convention,“Beta, meeting vich tussin apna case poore zor naal rakhio. Bus media ton bachio.”And is it not a fact that he called me over to the same room later to tell me: “Bains Saab, dekho eh tuhadi duty hai ke jo party de faisle hon, siraf oh he akhbaraan vich chhapan, hor controversiaan jehiaan na chhed dio”? But what could a powerless media adviser do if boys love only “controversiaan jehiaan”? You looked suitably pained when you said that you were not allowed to place your views before the Cabinet. Are we talking about the same Cabinet before which you claim to have repeatedly argued against subsidies and made long power-point presentations? How else do you think should the Cabinet have allowed you to place your views before it? Or do you believe that “express my views” must mean “accept my views”? Does the Cabinet have no right to disagree with you? My way or the highway — is that what you mean? And you want to know “who these people in the core committee are” to question you? Yes, they are no nephews of the greatest leader Punjab has produced in modern times. But some people know them as men who have willingly made the greatest sacrifices for their beloved leader during most critical periods like the Emergency, Operation Bluestar, fifteen years of militancy or the most stressful years when a rampaging Amarinder went with brutal intent to destroy your “Dear Chief Minister”. They are the ones who have sacrificed high places in governments and spent years in jail for and with Badal. They are the ones for each one of whom Badal would give his right arm rather than allow anyone to show disrespect to them. Some of these men were shot dead or bombed away on Akali stages for standing by Badal. That's who they are. And none of them has shown lack of civility to ask you who you are other than being the nephew of the leader they worship. And their worship, I swear Manpreet, is not mere lip-service — adoring him with one tongue and criticising his governance with the other. And the disciplinary committee set up by your party cannot summon you because you are (were) a minister! Really? Do ministers enjoy diplomatic or divine immunity against their acts of indiscipline — a polite euphemism for bleeding the party to death faster than its enemies can do. The disciplinary committee cannot question you. The core committee cannot question you. The party president (Oh, that hateful name!) cannot question you. “My dear Chief Minister” cannot question you. That leaves only God with some semblance of power to ask you anything. But I am not too sure even on that, considering what happened to one ritual you performed with better than Amitabh Bachchan grandiose. The thespian is lucky you are not in the film industry. Your loyalty to Punjab is greater than your loyalty to your party. Okay, I believe you. But I will be honest enough to admit that my loyalty to Badal is greater than my loyalty to Punjab, because, unlike yours or mine, Badal's loyalty to Punjab carries the stamp of sixteen years in jail — all for fighting for the interests of Punjab. With Badal around, there is no need for Punjab to test your or my loyalty to it. And that's the man we have pushed through silent pain! And subsidies? They make no sense to you today, but please, Manpreet, recall these words from you to me in Bathinda when I was drafting the party manifesto for 2007 poll: “Bains Saab, pravaah na kario. Chak dio phatte. Jo marzi promise kar dio. Ik vaari balld de singaan nu hatth pen dio. Baad di baad vich dekhi jaaoo.” Unluckily, a man called Badal has a different view on commitments made to the poor. “I strongly disapprove of the politics of saying one thing to the people before the elections and doing exactly the opposite, once in power. That's how we are different from the Congress,” he was forced to publicly remind you on October 1, 2008. For me, Manpreet, these are painful moments. You surely know that I love you. But I have watched with acute anguish my icon suffering unbearable pain of broken ribs (to say nothing about his broken heart) and waiting and waiting and waiting for his most beloved brother to come at least to inquire about his health. Badal from his hospital bed had desperately kept calling Dass-ji to avert this emotional trauma, but with no success. Finally, when the younger brother did come to Chandiarh, it was not to inquire about Pash's health but to help his rebellious son publicly tear apart the legacy of the Badal household (and much else that concerns Punjab) at a press conference, about two hundred yards away from where Badal lay in bed, still in pain. I noticed a tear roll down his cheeks as he saw the spectacle live on TV. Manpreet, you and I once talked about Shakespeare's beautiful scripting of the divine tragedy of Caesar being stabbed by Brutus, the man he had loved and trusted the most. When Caesar saw Brutus stabbing him, he uttered those most famous three words in world literature: “You too, Brutus?” (et tu, Brute?) I am painfully reflecting on the gruesome possibility of a pious wounded soul, just discharged from the PGI, mumbling the same words in half sleep.
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THE Chief of the Army Staff, General Vijay Kumar Singh, is a third generation officer of the Rajput Regiment. He has had an outstanding track record ever since he was commissioned in 1970 and is an expert in counter-insurgency operations. Having taken over as chief in March 2010, General Singh has weathered the criticism of army high-handedness in Kashmir and maintained firmness in dealing with the situation apart from working towards transforming the Army. In an exclusive interview at his office in Delhi’s South Block, he spoke for an hour to Editor-in-Chief Raj Chengappa about his efforts to enhance the Army’s ability to deal with all kinds of threats both current and future.
Suffice to say that we are giving a thought to this entire range of threats and we are looking at upgrading our capability, looking at certain amount of restructuring that we need to do and how we will develop our human resource capital because that is the major thing. Wars are fought by human beings. Ultimately, it is a human being who is going to plant a flag and not a machine. So that capital has to be good. So how manpower is to be by recruited, trained, prepared, made technologically more aware and all that is part of this
gamut.
THE recent “offer” of the Union Finance Minister to Punjab to meet certain preconditions on fiscal front to get on opportunity for waving off nearly half of the outstanding Rs 70,000-crore debt, which Punjab owes to the Central agencies, has sparked a lively debate. One wonders in which capacity the Union Finance Minister has made this offer.