Bharatiya Janata Party leader Arun Shourie
has supported Prime Minister Manmohan Singh's decision of the diesel
price hike and stays neutral on FDI in aviation and retail. Speaking to
IBN18 Editor-in-Chief Rajdeep Sardesai, Shourie also said that Prime
Minister should go ahead with more reforms and take decision without
waiting for legislation.
Shourie also pointed out that adversarial politics has been taken
to an absurd level in India. "Whatever you do, I will shout against it
and then when I do the same thing you will shout against it and block
it. That is no format," he said.
Following is the full transcript of Rajdeep Sardesai's interview with Arun Shourie:
Rajdeep Sardesai: Joining me now is someone who was the
face of BJP's reformist impulses and that of the NDA government under
Atal Bihari Vajpayee. He was a minister then and a BJP leader, Arun
Shourie, appreciate you're joining us here. At a time when most people
have come out in the opposition strongly against the Prime Minister and
his explanation for a diesel price hike and FDI in retail, you've been
very supportive. Am I to understand that Arun Shourie believes that what
Manmohan Singh is doing is good for the country?
Arun Shourie: As far as the hike in diesel prices is
concerned, I'm personally for it. I believe that all petroleum prices
should be at their scarcity value because otherwise we are subsidizing
our import dependence. In a country where 75 pc of oil is being
imported, there is no need to go on subsidizing that, we are worsening
the situation for tomorrow in that case.
Second is that the deficits have become unmanageable. They've
become unmanageable because of this government. It disobeyed the
deception of the fiscal responsibility legislation and the Prime
Minister presided over these deficit budgets. Now the fact is that today
with a deficit of about 8.2 pc to 9 pc of the GDP, it is not
sustainable. And you look at the budget figure, in the budget it is
provided that petroleum subsidies will be Rs 43,580 crore. They're
running at a level of Rs 1,70,000 crore. How can we manage this? So, I'm
all for an increases in petroleum prices and it is only when they are
increased, and this is the third reason, that then alternate sources of
energy like solar power, wind power from biogas, from urban gas, these
will become viable. So, on that point, I'm with the Prime Minister, on
the others like FDI in aviation, that will only help a little in
consolidation, FDI in retail is neither here nor there, these
international companies are not going to come, even if they do, our
small shops are going to beat them, they've beaten these big companies
that came into retail. So, on the first point, I'm with the Prime
Minister, and I didn't say, as was quoted, that the Prime Minister has
shown his strength. I said that the Prime Minister's Office has
unlimited strength in India and for the first time on economic status,
the Prime Minister has taken one step.
Rajdeep Sardesai: So, let me look at the exact quote
Sir, because the interpretation that is being given is that Arun Shourie
has come out in support of Dr Manmohan Singh. You've said, 'Prime
Minister Dr Manmohan Singh has for the first time shown his strength'. I
asked this because a former colleague of Yours Mr Yashwant Sinha, the
then Finance Minister, has said that the Prime Minister must apologise
for bringing India into a 1991-like situation. Obviously you and
Yashwant Sinha then have serious differences.
Arun Shourie: Not in the slightest. He's a person I
enormously respect, he's my very good friend. There's no difference. I
did not say that the Prime Minister has shown strength. This is the real
problem today Rajdeep, you say something in a whole lecture, nobody
sees it, If you're going out, somebody asks for a little bit and that is
completely turned around. I said, that I just now told you that the
office of the Prime Minister has unlimited strength and I illustrated
that by saying that Atal ji would just have to nod and those things
would get done, he would just raise his eyebrows and those things would
not get done. So also the Prime Minister of today has unlimited powers,
he has chosen not to exercise them for eight years. That is what
Yashwant Sinha has been emphasizing on that if the current situation is
due to the mismanagement of the government and the Prime Minister has
presided over a corrupt government and a government which mismanaged the
economy, so he shares the responsibility. Now whether somebody
apoligises or not is really just a way of pinpointing his
responsibility.
Rajdeep Sardesai: But what you're saying on the other
hand is that the steps that have been undertaken are necessary, that it
is a bitter pill, but it must be swollen. To that extent, the BJP
perhaps, needs to realise that that the country is going through an
economic crisis and perhaps, to appreciate that the Prime Minister has
finally chosen to bite the bullet.
Arun Shourie: Please do not ask me or make me say anything
about the BJP. I will say I agree with you, I agree with the Prime
Minister that the economic situation is dire, it's his responsibility or
not is a separate matter. After all the Industrial Production index is
going down from 12 pc growth to now 2 pc growth, deficits are
increasing, our foreign exchange reserves which were 10 moths inputs
imports falling to six months imports, a current account deficit running
at 10 pc of the GDP, these are unsustainable figures, Therefore,
Rajdeep Sardesai: But would you blame the government for this or would you say the global situation is such that the government is suffering.
Arun Shourie: Rajdeep you will well remember when we were
saying take urgent steps, the government was saying 'no, no, no, we are
decoupled from the world economy'. Now we're saying that it is because
of the problems in Greece that we're in trouble. So, forget this past.
My plea to everybody is the situation today is in front of us. The Prime
Minister has himself spelt out the situation in his address to the
country, and therefore, focus on the merits of each individual step. The
two of these steps were instance, I think nothing of them, one I think
is a very good step. So please focus on the steps that will be taken
from day to day and urge the government aso, please do not delay matters
now. You have a very very narrow window, not even of opportunity, but
of necessity.
Secondly, do not wait for legislation, it is not going to happen, it is not going to come about.
Rajdeep Sardesai: That's an important point, because
what you're saying is that because of the Parliament gridlock,
legislation is not going to happen, so go ahead with FDI in insurance,
FDI in pension through executive orders or through power sector reforms
which are now being talked about?
Arun Shourie: Some things in power sector you can do
because of prior legislation which the government has not implemented.
But there are many things that can be done without any legislation. I'll
give you one instance, the most alarming decline has been in the index
of industrial production. Let's take defence production. In India,
because of the monopoly that we've given to the DRDO, we've fallen
behind in many respects in our defence preparedness. But outside the
government sector, great capability has been built, technical and
engineering capability. Every Defence Minister from Mr George
Fernandes's time has announced that he will rope in the skills of the
private sector. Here is a boost you can give to manufacturing here and
now, you do not require any legislation. Similarly, we are today one of
the biggest importers of defence equipment. So, like other countries
like South Africa, we have set up an offset regime that some per cent of
the purchases we make from you, you have to source from India, and it
used to be in high technology items. Now if a company even takes a chair
for its office work, we say it's offset. So make offset real, don't
make it a farce. These are things that will boost Indian manufacturing.
Rajdeep Sardesai: The big worry is the ballooning
fiscal deficit. Now you've said that you support the diesel price hike,
but many believe that what may be good economics, doesn't make good
politics. If diesel and LPG prices are increased, if tomorrow through
power reforms people have to pay more power, these are issues that
concern the politicians. The politicians are worried that good economics
doesn't make good politics. How do you respond to that that reformist
Prime Ministers don't get elected, reformist agenda is not an agenda.
Arun Shourie: Well, then so much worse for the country
Rajdeep. for example, are the deficits of the state electricity board
sustainable and that has completely dried up for a fresh investment in
the private sector and therefore intensifying power politics for
tomorrow?
Rajdeep Sardesai: But politicians, whether they are from the Congress or the BJP, want free power that makes them electable.
Arun Shourie: That question you should ask them. On the
question of the economics of the matter, I feel that postponing good
economics is a disaster for the country and a disaster for the
politicians who acquire the country by ignoring economics.
Rajdeep Sardesai: Is that a paradox for democracy that good economics doesn't make good politics? How do you get elected next time?
Arun Shourie: Democracy is no substitute for soundness of
common sense. Just see the record, we shout and scream at a particular
time when a reform is made and forget it after that. I will give you an
example, can you often tell me that in 2011, by what percentage points
was the power rate in different states increased? You've forgotten, it
is up to 28 pc. Do you in July, in Kerala power rates were increased by
how much? By 30 pc. You can say this is going to ultimately dislodge all
the governments, but the fact of the matter is that in India I've found
that when you do something, people shout and scream and then like a sea
absorbing a great rock thrown into it, Indians absorb it and get ahead.
Today, I feel that a very good example is Narendra Modi in Gujarat. He
has increased power rates. He charges power from every farmer. But he
delivers power and nobody minds paying.
Rajdeep Sardesai: So you don't see these protests on
LPG reflecting a growing public anger, double digit inflation, the
housewife is affected. Mamata Banerjee says what about the kitchens of
the housewives?
Arun Shourie: Well, they're all phrases. What about the
kitchens of the housewives when there'll be no power and no coal because
of the protests on coal, no atomic power because of the protests on
atomic power, no hydro power because the activists are saying that the
Himalayas are being destabilized, then where will the kitchens cook
food? These are all phrases. Why not contrast what Gujarat has achieved?
Why are we shying away from that. They are charging for power and they
are delivering power. Everybody pays for medical services, education
cess has been increased, but services are being delivered.
Rajdeep Sardesai: So you're saying that the Indian
voter today will be ready for a hike in prices of diesel or power
provided the services are essentially delivered to him/her?
Arun Shourie: That is my presumption. But I'm no expert on
what the Indian voter will do. I don't know the Indian people and I
don't know whether many of these politicians know the people. They're
always as surprised by their victory as they are by their loss.
Rajdeep Sardesai: But doesn't it worry you? For
example, Manmohan Singh in 2001-02 was opposing FDI in retail when he
was leading the Opposition in the Rajya Sabha, today he is a voter of
it. Yashwant Sinha and the BJP, supported the FDI in their vision
document when they were in the government, now they oppose it. Doesn't
that worry you about democracy in India that when you're in the
Opposition you oppose the same reforms that you supported when you were
in the government?
Arun Shourie: Absolutely, and you're as if you're quoting
some of my books and articles. I've said that this adversarial politics
has been taken to an absurd level in India. Whatever you do, I will
shout against it and then when I do the same thing you will shout
against it and block it. That is no format.
Rajdeep Sardesai: But what is the solution Sir given
the gridlock in Parliament, given the fact that Parliament doesn't
debate these issues, given the fact that a Bharat bandh is seen as a way
to express people's anger, what's the way out of this adversarial
politics?
Arun Shourie: Just do the work you can do without
legislation at the moment. There is enormous scope for that. For
instance, just expedite the execution of infrastructure projects. Don't
squander money. There are a large number of companies in India who are
stuck in real economic difficulties because the government has not
discharged their bills. Pay them because they are working on
infrastructure projects. How many committees have been announced in
budget. Mr Chidambaram announced that this committee has been set up,
the Prime Minister is its head to ensure expeditious implementation of
core infrastructure projects, what has happened? Just get these
clearances off the ground, just get infrastructure projects going. Even
today, in one week, you can identify, which project, what is the
obstacle and that is removed with 10 persons sitting at one table. That
is the way forward. That is what will show that India can move ahead.
Rajdeep Sardesai: The reason I'm saying this Sir is
that over the next 18 months, we're heading towards the General
Election, it could come even earlier. There's talk that the government
will come up with big ticket social sector schemes, be it free health
for all, be it food security, do you believe that that is sustainable
today given the fact that the fiscal deficit threatens to get out of
control, or do you believe it is possible to do both in India?
Arun Shourie: I believe that that is the gravest danger in
the next 18 months because we're going into that cycle, we're going to
have elections in Gujarat, then Karnataka, then all the other states.
This is one of the gravest dangers that this government, which is weak
and has been paralysed thus far, will now go in for so called social
sector expenditure, which is just throwing money outside the window.
That will not improve delivery, that'll only mean higher deficit, higher
inflation and crowding out the capacity for the private sector to
borrow from the Indian saver. That'll be the repetition of the last five
years.
Rajdeep Sardesai: May I ask you in conclusion then, you
are trying to build the need for a bipartisan consensus at a time
economic strain. Unfortunately, as we're seeing in politics that even
after the Prime Minister's speech, exactly the opposite is happening.
There are more shrill, adversarial voices. I come back one last time,
the only way out you see, it seems, is that take executive decisions
that re in the interest of the country. almost bypass Parliament, that
you believe is the only way in Parliamentary democracy for good
economics to be implemented?
Arun Shourie: And other things also. These things cannot
be implemented, as you correctly implied, without everybody getting
together. Can subsidies be reduced without everybody getting together?
Everybody will agree in private that this level of subsidy is
unsustainable. Similarly, look at reservations. As I have written in my
books, there is a small cancer becoming bigger and bigger. Now
reservation on the basis of religion, pay. I bet my name on it that
before the next elections, this government, desperate for votes, will
decrease something towards reservation in the private sector. Can you
reverse this process without everybody realizing that everyone owes a
duty to the country also.
Rajdeep Sardesai: Isn't that a message for our
politicians. Mr Shourie, you've been in politics, are you worried,
therefore, that politicians are populists, therefore economic populism
doesn't make good economics, but politicians are not willing to
understand the difference, because they have to get elected?
Arun Shourie: Many other, I don't want to keep quoting the
example of Narendra Modi, but you'll regard him as a populist? He's
delivering services. Why can't we learn from that example?
Rajdeep Sardesai: Why can't the BJP learn it from him then. He's a BJP chief minister.
Arun Shourie: That you may ask the BJP. I remember that
Sardar Pratap Singh Kairon is not much of a populist, but he delivered.
If I give you an example, Mr Bansilal delivered on the ground in
Haryana, whatever other things he did. I remember many chief ministers
in the south. look at Karnataka, how well it was administered.
Rajdeep Sardesai: My final word then, has the Prime Minister in you view delivered, or is it too little, too late?
Arun Shourie: He has begun, I hope he will persevere and run very rapidly, otherwise, even this little thing will be just another '
aatishbaazi' (firecracker) which went up and then nobody heard of it.
Rajdeep Sardesai: So you believe that the Prime
Minister, if anything, the case is now for more reforms, not less
reforms, often through executive decisions of the Cabinet, this is a
moment where Manmohan Singh has to show that he's not just a one-off. He
has to sustain this momentum.
Arun Shourie: Indeed.
Rajdeep Sardesai: Mr Arun Shourie, as always, a pleasure talking to you. Thank you very much for joining us.
Source: http://ibnlive.in.com/news/pm-must-not-wait-for-legislation-for-reforms-shourie/294760-37-64.html
