New Delhi: Questioning the early adoption of socialism as an economic model by former prime minister Jawaharlal Nehru and its continuation under Indira Gandhi, Finance minister Nirmala Sitharaman said Monday that it did no good to India.
She said that the “central command and control structure, the licence quota raj” were all part of this copied “Soviet” model.
Initiating the discussion on ‘Glorious Journey of 75 Years of the Constitution of India’ in the Rajya Sabha, Sitharaman lashed out at the Congress for its ‘gareebi hatao’ slogan and said that the economic framework adopted by the Congress set India back by almost four decades. “Congress party’s attempts (in the past) have only weakened the Indian economy.”
The minister added that even though the “failed” economic model led the Congress to change and adopt a different one post 1990, the “damage” had already been done. “The mistakes made by the Congress have resulted in the Indian economy suffering…”
“Socialism kills and the human cost of delayed economic reform in India is significant,” she said, quoting a paper.
Sitharaman also referred to the arrests of poet and lyricist Majrooh Sultanpuri and actor Balraj Sahni when Nehru was the prime minister, hitting out at Congress for allegedly suppressing freedom of speech and expression.
The finance minister said that the Congress party “brazenly kept amending the Constitution to help the family and dynasty”. The amendments under the party’s rule, she said, were not to “strengthen democracy, but to protect those in power”.
Speaking on the economic impact of Constitutional amendments, she said, “It is a test for everyone of us, whether it is one amendment today or another one tomorrow. Does it have an economic intent for the larger economic good, social intent, process, constitutional spirit?”
Sitharaman said that the Congress often questions the Bharatiya Janata Party (BJP) and Rashtriya Swayamsevak Sangh (RSS) over their role in the country’s freedom movement, which she said they have responded to several times.
“What role did you (Congress) play in the economic freedom and growth, and building the economic strength of India? Why, 1980 onwards, Congress wanted to dump licence quota raj? In 1991, why did they want to reform and then take the claim for reforming? You did not have to reform, if it was so good,” she quipped.
Citing economist Arvind Panagriya’s The Nehru Development Model: History and Its Lasting Impact, Sitharaman said that Panagriya has written about how socialism and the license raj of Congress’s 50-year regime ruined India’s economy.
“Though the country did come to terms with its mistake and changed course in 1991, by then it had lost four previous decades. Moreover, the history built over these decades continues to haunt its development efforts even after the change of course,” she said, quoting Panagriya.
The finance minister also referred to how Indira Gandhi had nationalised banks in 1969. Quoting the former prime minister, she said, “The political situation in our country today demands that banking facilities should be extended in an increasing measure to backward areas, to agriculture, to small-scale industry and so on, and perhaps banking operations should be informed by a larger social purpose.”
By 2011, Sitharaman said, census data revealed that less than 60 percent of Indian households had access to banking services. “Only 10.3 crore zero balance bank accounts were opened till 2012. By contrast, over 54 crore Jan Dhan accounts have been opened since 2014, with 56 percent of accounts belonging to women.”
She added, “Under the PM MUDRA Scheme, over 50 crore sanctioned accounts, out of which 68 percent belong to women. Under Stand-up India scheme, over Rs 30,000 crore has been distributed to 2.5 lakh people, of which 76 percent are women. Under PM SVANidhi Yojana, which provides loans worth up to Rs 50,000, has benefitted over 67 lakh street vendors, of whom 45 percent women and 42 percent OBCs”.
During the debate, Sitharaman also quoted Dr BR Ambedkar and said: “Every government, whatever shall be in power, shall strive to bring about economic democracy…exactly what PM Modi is doing.”
The debate also saw heated arguments with Sitharaman demanding an apology from Congress MP Jairam Ramesh for accusing her of lying. “Accusing me of lying…is now very clear… runs in the Congress’s blood,” she remarked.
