How do the present reforms score over the Rao government reforms?
The policies under Rao were dictated by the 1991 crisis. It was forced to accept the IMF-World Bank terms, which didn't reflect our needs. Indiscriminate opening up has done more harm than good. The Government talks about being pro-poor, but the framework of liberali-sation is the same. There's no departure from the old reform regime.
So, what is wrong?
The Rao regime never spelt out the priorities. We want the UF government to do so clearly, so as to max-imise incentives for foreign capital and discourage them in low-priority areas, as stated in the CMP.
We opposed indiscriminate opening up, curtailing the public sector, and policies that erode self-reliance. Despite the CMP promises, foreign capital in core and strategic sectors has been invited in a way that's detrimental to our efforts in these areas, without pointing to alternative resources. Why should foreign investors get better facilities at the cost of our industry? What is the need to give counter-guarantees in power?
We don't want to keep goods or facilities away from consumers. But we must identify sectors where we can effectively util-ise foreign capital. In the last five years, liberalisation has benefited only a few, primarily the corporate sector. But the reforms haven't been designed so they gave back their due to the economy. In the budget, the efforts at resource mobili-sation have been disappointing. Instead of helping us come out of the IMF-Bank framework, industrial and fiscal measures announced so far reflect the thrust to carry forward old policies.
And financial sector reforms?
Financial sector is the heart of an economy. Once you allow an outsider access to your heart, he'll start ruling your head, controlling your moves. Once foreign capital has access to our financial sector, it can manipulate and control our economy. This is why we oppose opening up insurance.
What is wrong with the CMP?
The economic issues don't reflect the Left's views. It has some add-ons. We don't agree on disinvestment or insurance privatisa-tion. Or welcoming foreign investment in priority areas. The Industry Minister says spelling out priorities isn't possible. A total dilution of the CMP spirit.
What kind of reforms would your party support?
We want a more sophisticated approach towards foreign capital, a rational approach towards PSUs rather than disinvestment or closure. The CMP talks about strengthening PSUs, but the Government talks about disinvestment in profit-making PSUs. The taxation policy too needs an overhaul. Those who can afford should pay more. The current policy is to tax those who can't pay, or those who can't avoid paying.
If these issues aren't set right, do you plan to withdraw support?
We'll support steps to implement the CMP's positive aspects, oppose those that affect people adversely, while retaining our independent position. Withdrawing support would be a political decision. Economic issues alone can't force such a decision.
