Ways to Contain Fiscal Crisis
As appears to common men , government has done nothing to reduce imports and increase exports when they feel that current account deficit and trade deficit is higher than acceptable ratio ;
I as a common man think that if imports are reduced to bare minimum there is no doubt that all fiscal problems visible in the shape of current account deficit or trade deficit or falling rupee value will be solved .
I submit here under some cases of imports which can be reduced to bare minimum if government has a will to control the current fiscal problems.
GOI should ban or restrict import of Gold. There is no necessity of importing gold. Is gold import helpful for poor men or for increase in GDP growth?
Why coal and coal related products are allowed to be imported when India has huge stock of coal hidden in mines. Why India is unable to use coal resources available free in India and why not adequate money is spent for production of other coal products which are now being imported from other countries. As of now at least coal related products worth Rs.25000 crores are imported for various power projects.
Why readymade garments and cloth are being allowed to be imported when domestic industries are capacited enough to produce all textile products and have enough capacity to export the same. Why FDI is allowed in this sector which indirectly affects adversely the domestic industries are farmers who produce raw material needed for production of cloth and ready made garments.
Why medicine and drugs are imported when domestic industries have capacity to manufacture medicine of all types. And if some drugs and medicine are not manufacture in Indian soil, why Indian government do not make efforts to develop skill and technology in India to manufacture such medicines. which will help in boosting the morale of Indian manufacturers and boost the future of domestic industries and employment opportunities.
Why papers for currency notes are imported from Sweden and why not Indian industries can produce required papers on Indian soil only. This will help to reduce the supply of fake notes in the market.
Why import bill on fuel is increasing year after year. Why not government comes out with policy on use of fuel. Government says that fiscal deficit is increasing due to increased loan on fuel subsidy. But unfortunately government has not taken any step to reduce expenses on fuel subsidy. Number of car has been increasing in India ten or twenty times faster than the speed of rise in population. And especially after unprecedented rise in petrol prices people of India are now crazy to buy diesel car which are mostly used by rich people. Government can reduce subsidy burden by transferring this burden to rich .
It is rich people who can afford purchase of costly diesel car and it is they who save and who enjoy diesel subsidy. Government can save at least Rs.25000 crores fuel subsidy per year just by banning manufacture of diesel car and putting restriction on use of diesel car which not only affects the economy of the country but pollutes the environment,
In India , it is pity that there is no more cases of green revolution or Industrial revolution but there is case of CAR REVOLUTION.
Why government is spending huge amount on import of arms and ammunition? Our government can spend Indian rupees to manufacture arms and ammunition in India itself and reduce current account deficit to a great extent.
Indian politicians are spending huge money on foreign trip and serving no purpose for the country. There are many foreign trips which can be avoided.
It is unfortunate that Indian students are going abroad for higher studies and Indian educated and skilled labour prefer getting job in foreign countries.Economy of USA, UK and other countries are growing stronger with the help of Indian talent working there and unfortunately India is facing economic, social and administrative crisis.
In this ways there are number of other commodities and industrial goods which can be put under restricted import domain. Before 1991, government had hundreds of items put under restricted lists of items for imports and in which case government did not like to permit import. But after 1991 ,in the name of reformation, government started giving total freedom to importers which in turn not only created current account deficit and caused fall in value of rupee but also damaged the future of domestic industries and which resulted in lesser GDP growth and lesser employment opportunities.
Bad debts in banks are increasing not because rate of interest in Indian banks is higher but the bitter truth is that domestic industries are not in a position to survive due to overflow of imported goods in Indian market.
Similarly export of only those products and commodities which are in surplus production in India should be permitted .
It is in India only that farmers produce organic food products and export it whereas Indians are served food produced with chemicals and pesticides.
It is India which has to depend solely on Foreign Direct Investment or on the fund flow pouring in share market through Foreign Financial Institutes. Indian government do not promote saving tendency or investment in Indian industries but like to link future of India with FDI in retail .On the one hand Indian leaders claim that India is number one and will lead the world in coming years and on the other same brand of leaders do not hesitate in saying that FDI and FII are unavoidable and essential to meet current fiscal crisis.
Indian government has not even tried during last two decades to make optimum use of natural resources available in India as God given gifts and thought it better to allow free import and spoil the future of domestic industries. They are very much eager to spoil the future of retail businessmen of India by allowing multinationals to increase their retail network in India.
Common men can suggest the ways and means to reduce trade deficit, current account deficit and to stop further depreciation in rupee value. Common men can tell how to improve domestic production, how to increase Gross domestic product and how to reduce price rise and inflation. It is pity that great economist shed crocodile tears but fail to contain the fiscal crisis.
It is unfortunate that the policy of liberlisation, privatization and globalisation (LPG) adopted in the year 1991 in the name of reformation has proved more as a curse than a boon for common men and for the country. There is no doubt that a few lac of rich people have immensely benefitted from the policy of LPG and it is they who have become billionaire in two decades and it is they who have bought politicians and made them billionaire by funding them in the name of election.
Policy of reformation which are treated as Panacea for all evils by Indian leaders have proved to be poison for 100 crore people of India. Freedom given to real estate builders , car manufacturers and bankers have benefitted only rich class because poor and middle class persons cannot dream of buying a house or a car . Bank can give loan to buy a car or a home but to maintain a car or a flat is not easy for poor and middle class.
And much more --------------------------
http://danendrajain.blogspot.in/2012/06/indian-financial-problems.html
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