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Dumping debts on rival regimes

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  5 Jun 2016 12:00 AM GMT

WITH EYES WIDE OPEN

D. N. Bezboruah

The Fince Minister of the newly installed Assam government has done well to come out with a White Paper on the State’s finces that are in pretty bad shape, thanks to the Tarun Gogoi government that had no time for any kind of fiscal discipline or maintence of reliable accounts. Fince Minister Himanta Biswa Sarma’s White Paper lists quite a few shockers for the people of the State. The foremost among them is the fact that Tarun Gogoi’s government left Rs 10,000 crore in liabilities for the new government. This is not the first time that a Congress government in Assam has left a huge debt to be cleared by the new government in addition to an almost totally empty treasury. One recalls how in 1996, when the AGP government came to power for a second time, the earlier Congress government not only left an empty treasury but also ensured that some of the senior most bureaucrats were fled from Guwahati so that the newly elected AGP government would be in very deep waters indeed. Leaving a huge burden of debts and empty coffers is the typical kind of graceless, puerile and dirty game that the Congress is in the habit of playing with any political party or alliance that is able to remove it from power. Such dirty games are possible only for a political party that has never worried about the consequences of its actions on the lives of the people.

The Fince Minister’s White Paper reveals that the new government has inherited a committed outstanding liability of over Rs 10,000 crore from its predecessor government. This includes committed liabilities of Rs 1,359.29 crore of the former Chief Minister’s special packages and Rs 1,039 crore (till May 2016) of the Public Works Department. While tabling the ‘White Paper on Assam State Finces’ in the State Assembly on Friday afternoon, Himanta Biswa Sarma highlighted the fact that the interl resource generation growth, which had stood at 24 per cent in 2005-06, came down to a mere 1.39 per cent in 2014-15. “The 1.39 per cent growth was the lowest in the history,” Sarma told the House. According to the White Paper, the situation improved to 3.39 per cent over the previous year. The Fince Minister also revealed that compared to what the State had got during the last five years of the Dr Manmohan Singh government at the Centre, the Modi government had already surpassed the rate of increase in just two years. The White Paper also revealed that of the total budget of Rs 72,572.90 crore (Plan and Non-Plan taken together) in the year 2015-16, the State government was able to spend only 49.80 per cent of it. Another significant revelation made by the new Fince Minister was that the State, in order to attract the incentive grant of Rs 300 crore from the 13th Fince Commission during 2010-15, had predicted itself as a revenue surplus State. However, the strategy backfired resulting in revenue loss due to ineffective representation before the 14th Fince Commission. The Fince Minister also assured the House that the new government would move ahead with a focused motto and programme of ‘Restart Assam’ in order to mop up maximum possible resources through a coordited and concerted mission mode program. Reacting to Sarma’s comments, former Chief Minister (and Fince Minister) Tarun Gogoi said, “Mistakes might have taken place during our tenure. But one must also keep in mind that there was overdraft when the Congress government came to power in 2001.” Gogoi also told his successor that the State still had Rs 3,500 crore with the Reserve Bank of India. Former PWD Minister Ajanta Neog chipped in with the suggestion that the Fince Minister should assiduously pursue the oil royalty issue.

The fincial situation of the State may not be as bleak and hopeless as it might seem at this point of time. In the first place, governments have the means to carry over debts and stretch them (apart from reducing the interest rates) so that even fairly large debts can be handled with dignity and honour. Tarun Gogoi’s announcement that the State still has Rs 3,500 crore in its kitty is a relief of sorts. But going by the Tarun Gogoi brand of fiscal discipline and accountability, one is not sure whether his statement can be taken at face value. However, the fact remains that the State has to repay huge debts incurred by a former government from the very first week of its functioning. The question that is being asked quite legitimately is: “Should Chief Minister Sarbanda Sonowal spend his time and energy on real development or on clearing huge debts left to him by the former government?” This would be a very valid question, were it not for two facts of life that seem somewhat favourable to the new government. The first is that it has a sympathetic BJP-led government at the Centre that is unlikely to punish the newly installed State government in Assam for the sins of its predecessor Congress government. The second reason is that successive governments in India seem to have found some merit in having deficit budgets as long as such deficits are within mageable limits. Besides, the procedure of making book transfers of sizeable government debts makes the exercise much less painful than it would be in the case of individuals or corporate bodies seeking to settle such debts. However, in higher circles even individuals like Vijay Mallya can get away with unpaid loans of over Rs 9,000 crore as long as they have not become perso non grata. It is only when they do become perso non grata and refuse to return to India to repay bad loans, that the government seems to worry about such bad loans. We do not encounter many people asking the very basic question as to why the consortium of banks deemed it proper to advance such huge loans to a person of Mallya’s reputation in the first place. No wonder almost all banks in India have more non-performing assets than they know what to do with, and we have a government at the Centre that seems to be quite sympathetic to such irresponsible banks.

Considering that what has happened this time in the way an outgoing government treats an incoming government of a rival political party is nothing new, it might be more pragmatic to treat this as an occupatiol hazard for political parties in India, it might make better sense to find ways of dealing with this kind of game rather than to keep moaning and groaning about such happenings. In fact, it might make good sense to have a legislation restricting the expenditure of governments during the last three or six months of their tenures, so that no government can be accused of leaving empty coffers for successor governments. But that is not all by way of protecting the people. If the BJP-led government in Assam is really sincere about ensuring clean and corruption-free governce, it must initiate legal proceedings against all ministers of the previous government who have miraculously increased their persol assets beyond all ratiol expectations.

One of the major challenges before the new government of Assam is that it is not going to be enough to provide clean and corruption-free governce. It must also honour promises made by the BJP before the Lok Sabha elections of 2014 as well as those made before the Assembly elections of 2016. There are promises relating to employment for a State that has the highest unemployment rate in the country. Creating jobs for 26 lakh unemployed is no easy task. Providing electricity to the entire State all through the week without interruption is an even taller order. But promises made have to be honoured—even when greedy ministers of an earlier dispensation have fouled up things. No one was really asking for a sealing of the Indo-Bangladesh border in just one year. The new BJP-led government had set a deadline of two years that it has now reduced to a year. It is the kind of bravado that was uncalled for. But a desperate deadline has been set, and must now be honoured. It will perhaps be a long time before the BJP learns to set realistic deadlines. But it must nevertheless learn the importance of keeping promises. That is how life goes on anywhere in the world.

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