amnesia is a common trait of governments. In particular,
parties in power often prefer to forget the promises
they made while in opposition, or on the campaign trail.
But usually they try not to make explicit promises once
in power, which they then can be held down to. The recent
penchant among governments in India to declare programmes
of action (as has been done by the United Front government,
the NDA government and now the UPA government) has stemmed
not from any deep desire to declare their intentions
so openly, but from the exigencies of coalition politics,
and the nature of support on which these governments
have been based.
problem with such stated programmes, of course, is that
they make selective amnesia much more difficult. The
promises made are no longer phrases uttered in the heat
of campaigns; they are put down on paper and evident
for all to see, including allies in the coalition and
any parties who are supporting from outside. Therefore,
when governments still choose to ignore or even go contrary
to the declarations and promises made in the stated
programme from quite early on in their tenure, they
must be either rather stupid themselves, or else relying
quite strongly on the stupidity of others.
The jury must still be out on the extent of which all
or any of this is true of the current UPA government.
But there is no doubt that the National Common Minimum
Programme must be an increasing embarrassment for some
of the most powerful ministers in this government, and
the Finance Minister in particular. It is no secret
that Mr. Chidambaram was not really involved in the
drafting of the NCMP, and since then he has barely concealed
his distaste for most of its provisions even in public.
But the extent of deviation thus far of major areas
of economic and fiscal policy, from the declarations
of the NCMP, cannot be the result of personal predilection
alone; it must surely indicate a deeper or wider lack
of motivation in the highest echelons of government.
Let us consider some of the promises made in the NCMP
that relate specifically to fiscal and budgetary policy,
and juxtapose these against the available evidence so
far. The Budget 2005-06 is particularly important in
this regard, since it provides indications of intention
for the future, but also tells us something about how
the money was spent in the previous year, and so about
the seriousness of the stated intentions.
Arguably, the single most important promise in the NCMP
related to employment generation, which the government
(to its credit) at least recognised as a major problem
requiring direct public intervention. The NCMP promised:
''The UPA government will immediately enact a National
Employment Guarantee Act. This will provide a legal
guarantee for at least 100 days of employment to begin
with on asset-creating public works programmes every
year at minimum wages for at least one able-bodied person
in every rural, urban poor and lower middle-class household.
In the interim, a massive food-for-work programme will
What has happened thus far? The way in which the draft
EGA bill now placed in Parliament has been diluted so
that its provisions come nowhere near providing a genuine
employment guarantee has been discussed widely and is
now well known. But it is also clear that the Finance
Ministry is hardly providing any allocation for such
a scheme in any case. The government's own estimates
are that such a scheme would cost at least Rs. 25,000
crore per year, while other estimates have gone up to
around Rs. 45,000 crore per year.
But last year, the UPA spent only Rs. 1818 crore on
the Food for Work scheme which is supposed to be the
precursor of the EGA, in addition to the Rs. 4590 crore
allotted to the Sampoorna Gramin Rozgar Yojana (SGRY).
In the current budget, the proposed allocation for Food
for Work is only Rs. 5400 crore, a relatively small
increase, while the allocation for SGRY has actually
been cut to Rs. 3600 crore! This suggests that even
the piffling amount being set aside for EGA is at the
cost of other employment programmes, rather than in
addition to them.
The other area of declared policy priority of the UPA
government has been agriculture. Various promises have
been made relating to expanding institutional credit
to agriculture and to the rural areas generally, and
in this regard it is true that the direction of change
has been positive, even though the pace of expansion
of agricultural credit has not been as fast as desired.
But the NCMP was also clear that public investment and
public protection of domestic cultivators from import
competition were also to be among the strategies employed
to regenerate agriculture.
Thus, the NCMP stated that ''the UPA government will
ensure that public investment in agricultural research
and extension, rural infrastructure and irrigation is
stepped up in a significant manner at the very earliest.''
Also, ''the UPA government will ensure that adequate
protection is provided to all farmers from imports,
particularly when international prices fall sharply.''
There is no question that both expenditure and allocations
to agriculture have increased - the actual spending
in the current year (at Rs. 4799) is estimated to be
higher than the original plan outlay of Rs. 4643 crore
and even more (Rs. 6425 crore) has been budgeted for
coming year. But these are still trifling amounts, and
this is because agriculture is still dominantly a state
subject and most of the expenditure in this area - whether
in irrigation, or in agricultural research and extension,
or in the provision of related rural infrastructure,
is undertaken by state governments.