Mailbag

No subsidy

Sir,

Unavoidable big hike in diesel prices, and Prime Minister's warning for future tough economic measures, call for a systematic financial policy in the country, which must not be based on political requirements. Financial discipline should be established by arranging an automatic review/revision of prices of all goods and services having government-administered prices to be declared generally in the Union Budget,and to be implemented either with immediate effect or from first day of new financial year. Since most political parties when in power, themselves have to make such unpopular hikes, it is not difficult to achieve a political consensus in national interest for having disciplined systematic financial system in the country. BJP government followed UF government to link local diesel prices with global prices till global prices declined. But when global prices increased, BJP out of poll-fear, avoided upward linking of local and global diesel prices for six long months, dragging country in unwanted extra heavy fiscal deficit. Since associated price-hikes in other commodities are never taken back by lowering diesel prices, formula of linking local and global prices of diesel may be adopted only for upward revision, utilising any lower global price in meeting other unexpected financial burdens like of Kargil war!

Vast difference in diesel prices of upto about 20 percent in different parts of the country is mainly due to differing local taxes. Union Government should convene meeting of states to arrive at uniform rates of local taxes in all states for achieving uniform prices of commodities throughout the country. Government administered prices may be normally in round figures. For automatic upward revision of indirect taxes with usual trend of price rise, excise duty should be imposed ad-valorum on all commodities with single slab for a commodity. Union budget must not reflect as an annual feature to change tax-rates!

Subsidies and Surcharges must be avoided. There are too many subsidies misused by vested interests. Heavy subsidy on post-cards is misused by business-firms while it is of no use to common persons who may be writing just one or two post cards in a month! Likewise subsidy on news-print is causing a national wastage of newsprint by selling newspapers/magazines at prices sometimes even lower than their waste-values! Subsidies must be gradually phased out to strengthen the economy. However surcharges must also be avoided. Surcharge on Income Tax gave a back gear to voluntary tax compliance by honest tax payers! Government can get taxes manifolds by harsh measures to curb currency circulation.

Yours etc....
Subhash Chandra Agrawal,
1775, Kucha Lattushah,
Dariba, Delhi-110006.

IT industry in J&K

Sir,

Apropos Mr Rajiv Jamwal's letter ''Concession for IT Industry'', I would like to say that it is not only necessary but has become inevitable to strengthen the IT industry in our state.

The IT industry is not the industry only with ever increasing growth rate but has provided the most number of job opportunities in the last decade.

This is the only Industry which requires the minimum infrastructure to set up and expand unlike other industries which are dependent on factors like roads, railway links, raw materials and other helping units.

It can be established, operated and expanded at remote places like ours, the State of Jammu and Kashmir. Almost independent of geographical location it requires no means of conventional transport which is the main and only drawback of our State.

The requirements to set-up this industry are :

I. Skilled manpower (As per my understanding we have it in abundance)

II. Office in a small building (preferably in a peaceful area, with lesser noise).

III. The communication links, may be ISDN or VSAT links.

Most importantly no investment on raw materials as they are not required at all.

The Market to sell the output/product is enormous/huge and in great demand.

In a state like ours where setting up an industry is quite difficult (taking into consideration the present economical and geographical condition), the Government of J&K has to really think seriously and take necessary, and as early as possible, action to boost the IT Industry. The boost to the IT Industry will solve many of the prevailing problems of the state.

First of all it will reduce the unemployment to an extent and give relief to the qualified unemployed (Engineers, Graduates, Postgraduates) young generation which is wasting its precious time in visiting the Unemployment offices regularly.

Secondly it will help the other industrial units and other sectors of the state to grow, develop and keep pace with their competitors in other parts of the world.

Last but not the least, it will improve the economy of the state and its people.

If our State Govt. does not take the necessary action to develop the IT Industry and IT Infrastructure, our state will be isolated and left behind. Business will come to a virtual halt and rest can be imagined........

Yours etc....
Buti Lal
Zuerich, Switzerland
buti.lal@ubs.com

Well deserved drubbing

Sir,

The politically conscious and mature Indian Voter has rightly punished the fussy congress party in the recent Lok Sabha elections for its political sins. Just to heal its hurt ego, it engineered the collapse of one government after the other at the centre in the recent past, thus causing political uncertainty and throwing the interests of the country into jeopardy. The most malicious and desperate manoeuvre on the part of the party in question was evident in its reprehensible and highly irresponsible act of bringing down the BJP-led coalition government (a one vote victory, though) without its having any alternative means of governance in view. It took recourse to the proverbial 'dog-in the manger' policy, regardless of the immense harm it caused to the country in more than one way. Its bankruptcy and the resultant frustration were manifest in its falling prostrate before an inexperienced lady to save it from extinction. The panic-stricken members of the once grand old party went from pillar to post, dragging along the unsuspecting and innocent lady, to garner support to come to power, but all in vain. They succeeded only in foisting an unnecessary election on the country which it could ill-afford and which entailed a colossal loss of public funds (estimated at Rs 845 crore). Contrary to its tall claims of forming the new government, the congress party had to eat a humble-pie, in consequence of its extremely poor performance in the election. There is a lesson in this for all. Any political party which is obsessed with political power, and throws to the winds the national interests is destined to get sooner or later, a severe drubbing from the politically alert public. The congress has got it now.

Yours etc...
Prof. M L Raina
<m l raina@hotmail.com>