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Updated: November 25, 2012 02:50 IST

No use fighting food subsidy, says Rangarajan

Special Correspondent
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C. Rangarajan, Chairman, Economic Advisory Council to the Prime Minister, speaks during an interactive session on 'Indian Economy - Vision2020' at MCC Chamber of Commerce&Industry in Kolkata on Saturday. Photo:PTI
PTI
C. Rangarajan, Chairman, Economic Advisory Council to the Prime Minister, speaks during an interactive session on 'Indian Economy - Vision2020' at MCC Chamber of Commerce&Industry in Kolkata on Saturday. Photo:PTI

Food subsidy is important in a country like India and there is no use fighting it, C. Rangarajan , Chairman of the Prime Minister’s Economic Advisory Council, said.

Admitting that fiscal consolidation, a necessary pre-requisite for sustained growth, was an area of macro economic concern, he said that subsidies needed to be pruned, well -focussed and prioritised.

“What is relevant is the total amount of subsidy. We can provide for food subsidy while reducing other subsidies. There is no good fighting it. In our country, it is important. Government thinks this is of paramount importance. But we need to be courageous to cut other subsidies. It is in this context that one must understand the action of the central government to raise the price of diesel,” Dr. Rangarajan said.

He was participating in an interactive session on ``Indian Economy-Vision 2020’’ organised by the Merchants Chamber of Commerce and Industry.

To a question on foreign direct investment (FDI) in retail and fears of Chinese goods swamping the Indian markets, Dr Rangarajan said that entry of Chinese goods was not banned even now and Indian industry would have to enhance its efficiency. “If there is any reason to believe that it is dumping then there are forums like the WTO (World Trade Organisation) to take it up with,” he said.

To another question on LIC “having to pick up shares of Hindustan Copper Ltd.”, he said they did so due to business consideration. He also said that the government’s disinvestment would get back on track very soon.

Growth rate

It would be difficult to forecast how the current year would turn out, he said. However, he expected the investment sentiment to change in the wake of decisions on FDI and petro-product pricing. “On the whole, the growth rate this fiscal may be between 5.5 and 6 per cent,” he said.

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It is shocking to see such anti-poor comments from supposedly educated people regarding poor getting free food and spending money on liquor. This is just a biased and prejudiced misconception with no basis in reality. It is just a rumour spread to discredit and demean poor people who are disenfranchised, ill organized and have no voice to counter such allegations against them. Crores of poor have very little to eat and NREGA funds are eaten away in corruption. In fact, scrapping of the scheme may have no adverse effect as the poor hardly get their due in NREGA or any other scheme. The poor deserve all the support they can get. Instead of supporting them, people criticize them for no fault of theirs. The increased wages are good for the poor and artificailly depressed wages were due to forced labour/begar, voilent and exploitative practices in the fuedal setup and lack of employment avenues, all leading to a sub-human existence of the poor.So called educated people have no qualms here.

from:  Aatish
Posted on: Nov 27, 2012 at 13:13 IST

do not give a man the fish, teach him how to fish,
Why do we need subsidies in food, power etc? Why dont they come out with a
scheme that every mandal/ district as per the population, should have vocational training schools, where ant 4th grader can be taken in, theres a severe shortage for trained and qualified plumbers, electricians, tailors, carpenters, welders, drivers, heavyequipment operators, scaffolding staff, masons, hotel management staff, bedside nurses, etc, we have the population,
And have a tie up with every industry, identifying shortage of skilled manpower, where these students work after being trained as apprentices. Lets together build our nation not sell our navratans to fund further subsidies.
Let not the fabric of our society degenerate so much that learned people turn a blind eye to whats happening in our country.

from:  srivani
Posted on: Nov 26, 2012 at 10:10 IST

its shocking to see a learned man recommending subsidies.
Today the average labourer gets his basicfood grains n pulses for free and through
the nrega scheme a wage for standing 2 hrs in a queue. The impact of this is in every
village in the morning we have long queues in liquor shops, the liquor tax collection
is a good proof for this. Nobody wants to do farming any more as farm labourers are
difficult to find, in the years to come india which has been food selfsufficent will be importing.
Mr rangarajan comments indian industry should imprpve on efficency, how? When
our interest rates are 14% to 17%, us, europe and china have interest rates of 6%, we give power 24/7 to mnc's and our own industries have 14hrs of power cut randomly, our industries in tirupur etc are not able to compete with labour costs with bangladesh and phillipines, thanks to mrs gandhis pet project, NREGA scheme. coming decade our industry will be wiped out to a great extent. Wto does not protect indian interests.

from:  srivani
Posted on: Nov 26, 2012 at 09:55 IST

I concur with Mr.Rangarajan. Food Subsidy for the poor will have to
continue for many more years since there are millions of poor in India
who are still living on just one meal a day. The distribution mechanism
has to be toned up and corruption in this area has to be put down with
an iron hand on priority, in order to ensure that the food grains meant
for poor don't get diverted. Moreover the distribution should happen on
time and the stocks shouldn't be allowed to rot as it is often happening
now.

from:  Kousalya Murali
Posted on: Nov 25, 2012 at 12:43 IST
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