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Corruption corrodes the Republic'
August, 18th 2011

With the issue of corruption and dissatisfaction over the inadequacy of the Lok Pal Bill to deal with it looming large, not only among political parties but also from the disparate group of non-governmental organisations (NGOs), the noisy Indian democracy has seldom seen such strident demands being made of the elected government to clean up the mess. In this charged milieu, Business Line caught up with the articulate senior leader and Lok Sabha MP of the principal Opposition Party, the BJP, Mr Jaswant Singh, to get his take on issues impacting governance, in general, as also on the economy.

As a former Union Finance Minister, Mr Jaswant Singh minces no words in taking the ruling dispensation to task for its various acts of omission and commission. When this correspondent met him at his residence in Teen Murti Lane on Independence Day, Mr Singh said, more in anguish than anger: We have today entered the 64th year of independent life there are may achievements to the nation's credit but a very great discredit and debility is on account of this corruption.

On both the Direct Tax Code and the Goods and Services Tax (GST), Mr Singh laconically said: Both are vital for the health of the national economy. We must examine the total question of direct tax reform how to make it simpler and simultaneously more effective. GST is a good and progressive tax and it is a proposal the NDA had mooted.

Excerpts from the interview:

What is your assessment of the groundswell of protests against corruption, and where does the BJP stand on in this?

It is not simply money corruption that afflicts us today. A much more serious aspect of corruption is the corruption of spirit that afflicts the country. There is an erosion of values and respect in the institutions of the Republic. We cannot dismiss money corruption as simply a global phenomenon. It is an aspect that corrodes the very system of the republic and saps energy from its systems.

Whereas the UPA government has failed in this regard, the failure is broad, spread over many years and is a consequence of not responding properly in time to the cancerous aspects of this ailment. Because it was not so attended, the UPA today comes across as possibly the most corrupt government that India had ever seen in the last so many decades of our Independence.

You ask me whether and how the BJP has fared in this regard? The NDA was in office only for six years, of the past 64. State governments of the NDA or NDA-led BJP or BJP's allies are infinitely better than the Congress of UPA. But that, by itself, was not enough; for, at the Central level, how can the party or the NDA challenge this malady? It is a major responsibility. It is not as if the NDA can mount an offensive with an army. Yet it must awaken the nation's conscience in this regard and challenge the misdeeds of the UPA.

In the Opposition, why is the BJP not supporting the reform measures of the Government so that many pending reform-centric Bills can see the light of the day?

The BJP in the Opposition cannot initiate reforms. Reform has to come from the ruling establishment. But reform, per se, is not an answer to the difficulties that afflict the economy.

The principal difficulty, to my mind, is inflation, particularly food inflation, which has already touched 10 per cent again. That is a criminally sapping burden on the nation's citizens; even otherwise, inflation as a spectre and a reality has very seriously hit the national economy.

Part of it is the consequence of rising global commodity prices plus fluctuations in the hydrocarbon sector and, of course, the economic turmoil that both the US and the European Union economies are going through.

This is bound to have a consequence on the Indian economy and that, to me, is like a warning signal to our economy.

If the major destinations of Indian exports are in turmoil, how do you account for the view that the high export growth rate figures are phoney? What are the crisis points in the real sectors of the economy?

I cannot account for it because I have to go by the figures the government and its statistical departments present us with. If the purchasing power of the western world has declined, and as rupee has appreciated relatively, then exports do not, per se, become easier. This is clear. Yet I have to examine the statistics more carefully before I comment on this. If you see the growth profile of our economy, of the three segments, agriculture, manufacturing and services, the least progressive and growth-oriented and the most worrisome is the agricultural sector. It is reflecting virtually no growth.

This is an area of great concern to me because, unless this is attended to, more than 75 per cent of Indians being dependent on agriculture, their incomes and purchasing power will be directly affected.

Between services and manufacturing, it will be simplistic to work on the premise that growth in services alone can pull India out of the woods. It cannot. India is not simply a services sector economy manufacturing growth must keep pace and expand to generate employment.

But after the introduction of the Mahatma Gandhi National Rural Employment Guarantee (MNREGA), an illusion of employment has come into existence. The scheme is riddled with corruption and it has also got a great conceptual anomaly because it has robbed the labour market of proper labour support to agriculture when needed.

As a chairman of the PAC, I attempted to address the issue of the NREGA scheme by choosing certain States and doing the needful. I think we need to look at it again.

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