ET NowIn a chat with ET Now, Siddharth Varadarajan, Senior Fellow, Shiv Nadar University, talks about his expectations from the Budget 2015. Excerpts:
ET Now: What is the broad message from the Delhi polls verdict? Just when we thought there were no takers for politics or freebies, the Delhi election was won by the Aam Aadmi Party largely on promises of free goodies. So, can we say it is the end of the politics of freebies?
Siddharth Varadarajan: I would be wary of comparing the promises of the Aam Aadmi Party made in Delhi to the kind of irresponsible freebie-mongering that we have seen in Punjab or Tamil Nadu. In those states, parties like the AIADMK or the Akali Dal or even the BJP have promised farmers free, unmetered water, free electricity, and so on.
In Delhi, AAP said they would do an audit. They are confident that pursuant to that order, they will be able to cut electricity prices. Also, they have come out with a fairly rational water proposal where you give free water up to certain extent. If you consume even one litre more than that, then you are billed for the entire amount. So, it is actually a nuanced proposal. It suggests that people of Delhi are willing to have faith in AAP's ability to deliver on that promise.
PM Modi has questioned the wisdom of parties that are offering free electricity. But he is conveniently forgetting that the BJP’s ally Akali Dal in Punjab has always cashed in on this.
But PM Modi and FM Jaitley are quite mindful of how cooperate India is looking at Budget 2015. The big companies that backed the BJP in the election are hoping that this time it will be a pro-reform budget.
They expect that there will not be too much of increase in public expenditure. They are looking at subsidy cuts. They are expecting new initiatives that will essentially make doing business easier, and perhaps increase the profit rate.
PM Modi is quite aware of the fact that he will be judged by that metric. So, I do not think he will be looking to come up with a please-the-public kind of a budget this time. In any case, fiscally, his hands are really quite tied.
ET Now: This government came in on the promise of big development, on the back of a different economic ideology. But does a risk lie within? Do the fringe elements pose of risk of changing the narrative from development to communalism?
Siddharth Varadarajan: That particular risk has already reached an advanced stage. It has taken the sheen off a lot of what PM Modi said during his campaign. His silence on growing communalism for about eight months has not really helped.
ET Now: The other key political challenge is the numbers in the Rajya Sabha. Whichever way you look at it, it seems unlikely that the government is going to get the numbers in the Upper House to push through key economic legislation. What seems to be the way forward?
Siddharth Varadarajan: The ball really is in the government’s court. Of course, the opposition also behaves badly; there is no question about that.
But ultimately, the onus is on the Prime Minister and on the ruling party to ensure that its legislative agenda is piloted well. What is needed is the right amount of goodwill and a proper approach towards multiple parties that exist in the Rajya Sabha.
That is the case of Trinamool, which the BJP has insisted on alienating. Instead, the ruling party could have tried to have smoother relations with it.
I am afraid that the way in which the BJP is pursuing its political agenda in some of the states, building consensus in the Rajya Sabha is perhaps going to be difficult. There is always the option of joint sessions, but that itself requires a bill to be first placed and defeated in the Rajya Sabha.
At the end of the day, you cannot be having joint sessions for each and every bit of legislation. So, it is a problem that the government will have to find some way for resolving.
These logjams assume greater significance when it comes to extending the life of the ordinances that were pushed through without any discussion. It is important that the Parliament debates these, deliberates on these. It’s only after proper discussions that they be either passed or rejected in a legal manner.
ET Now: What is the broad message from the Delhi polls verdict? Just when we thought there were no takers for politics or freebies, the Delhi election was won by the Aam Aadmi Party largely on promises of free goodies. So, can we say it is the end of the politics of freebies?
Siddharth Varadarajan: I would be wary of comparing the promises of the Aam Aadmi Party made in Delhi to the kind of irresponsible freebie-mongering that we have seen in Punjab or Tamil Nadu. In those states, parties like the AIADMK or the Akali Dal or even the BJP have promised farmers free, unmetered water, free electricity, and so on.
In Delhi, AAP said they would do an audit. They are confident that pursuant to that order, they will be able to cut electricity prices. Also, they have come out with a fairly rational water proposal where you give free water up to certain extent. If you consume even one litre more than that, then you are billed for the entire amount. So, it is actually a nuanced proposal. It suggests that people of Delhi are willing to have faith in AAP's ability to deliver on that promise.
PM Modi has questioned the wisdom of parties that are offering free electricity. But he is conveniently forgetting that the BJP’s ally Akali Dal in Punjab has always cashed in on this.
But PM Modi and FM Jaitley are quite mindful of how cooperate India is looking at Budget 2015. The big companies that backed the BJP in the election are hoping that this time it will be a pro-reform budget.
They expect that there will not be too much of increase in public expenditure. They are looking at subsidy cuts. They are expecting new initiatives that will essentially make doing business easier, and perhaps increase the profit rate.
PM Modi is quite aware of the fact that he will be judged by that metric. So, I do not think he will be looking to come up with a please-the-public kind of a budget this time. In any case, fiscally, his hands are really quite tied.
ET Now: This government came in on the promise of big development, on the back of a different economic ideology. But does a risk lie within? Do the fringe elements pose of risk of changing the narrative from development to communalism?
Siddharth Varadarajan: That particular risk has already reached an advanced stage. It has taken the sheen off a lot of what PM Modi said during his campaign. His silence on growing communalism for about eight months has not really helped.
ET Now: The other key political challenge is the numbers in the Rajya Sabha. Whichever way you look at it, it seems unlikely that the government is going to get the numbers in the Upper House to push through key economic legislation. What seems to be the way forward?
Siddharth Varadarajan: The ball really is in the government’s court. Of course, the opposition also behaves badly; there is no question about that.
But ultimately, the onus is on the Prime Minister and on the ruling party to ensure that its legislative agenda is piloted well. What is needed is the right amount of goodwill and a proper approach towards multiple parties that exist in the Rajya Sabha.
That is the case of Trinamool, which the BJP has insisted on alienating. Instead, the ruling party could have tried to have smoother relations with it.
I am afraid that the way in which the BJP is pursuing its political agenda in some of the states, building consensus in the Rajya Sabha is perhaps going to be difficult. There is always the option of joint sessions, but that itself requires a bill to be first placed and defeated in the Rajya Sabha.
At the end of the day, you cannot be having joint sessions for each and every bit of legislation. So, it is a problem that the government will have to find some way for resolving.
These logjams assume greater significance when it comes to extending the life of the ordinances that were pushed through without any discussion. It is important that the Parliament debates these, deliberates on these. It’s only after proper discussions that they be either passed or rejected in a legal manner.
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