Friday 1 March 2013

Chidambaram’s three promises, will it solve any purpose?


Gyanendra Kumar Kashyap

The finance minister has made promises to the women, youth and poor of the country; the success of living up to the promises depends on how well the initiatives are implemented

Presenting a budget just before the election year is not an easy task; especially if you are Palaniappan Chidambaram, a key member of the dream budget team. Given, his image as a reformist – at least to some, the finance minister as always was in two minds – whether to give in to populist demands or to adhere to pragmatism. In his budget speech he did speak of the relation between policy and welfare and sough to make a straight forward and short budget speech. In due course of his budgetary speech, he emphasised upon three faces – and made due promises, offered minor sops to income tax payers but slapped a 10 per cent surcharge on 'super-rich' individuals and corporates, levied an inheritance tax and raised duties on mobile phones, cigarettes and luxury vehicles. While post budget reactions such as ‘damp squib’, ‘cautious, could have been courageous’, ‘lollipop’ etc., are doing the rounds; here is a look at the three promises he has made, and how the future could turn out.

“I wish to draw a picture of three faces that represent the vast majority of the people of India,” said finance minister Palaniaapan Chidambaram in the course of his budgetary speech. The faces he spoke of were that of – woman, youth and poor, precisely in the same order.

To the youth of the country, the finance minister has proposed to set aside Rs. 1,000 crore to extend skill development. He believes, and rightly so, that skill trained youth will give an enormous boost to employability and productivity. To the poor of India, the honourable minster made an assurance that Direct Benefit Transfer, which he believes has caught the attention of the entire nation, will be rolled out throughout the country before the incumbent government’s term expires. And yes, not to miss out on the Rs. 33,000 odd crores of additional grant to MNREGA. Well so much for the youth and the poor.

The real spark in the minister’s speech came in the form of a proposal to set up India’s first Women’s Bank as a public sector bank. The minister’s contention is that there is no bank that exclusively serves women. Thus it makes sense to have a bank that lends mostly to women and women-run businesses, that supports women SHGs and women’s livelihood, that employs predominantly women, and that addresses gender related aspects of empowerment and financial inclusion. To this end the finance minister has agreed to provide Rs. 1,000 crore as initial capital infusion. If all goes well, necessary approvals and banking licence could be obtained by October 3013 and new Women’s  Bank could start operation soon after.

At this juncture it is important to have a flashback; in his budget speech in 2010, the then finance minister Pranab Mukherjee had spoken of granting new banking licence to private players. We are yet to see new private banks. One can only earnestly hope, an all Women’s Bank (by whatever name it goes) does get to see the light of the day as promised, October 2013.

Well, a bank was not all that the minister promised to the women of India. Perhaps taken aback by the horrendous incident that took place in Delhi on December 16 2012, the minister spoke of how the incident has cast a long, dark shadow on liberal and progressive credentials of the country. “We have a collective responsibility to ensure the dignity and safety of women,” he said. So to empower women and keep them safe and secure, the minister has proposed to set up a fund, Nirbhaya Fund, where the Government will contribute Rs.1,000 crore.

Besides the two, the minister also proposed to provide an additional sum of Rs. 200 crore to Ministry of Women and Child Development to design schemes for women belonging to vulnerable groups.

It is this promise the minister made to the women of India that is being debated. It is being argued that an all-women bank, the Nirbhaya fund and an empathetic lecture on the girl child and women belonging to vulnerable groups, are mere measures which at best might only scrape the tip of the iceberg that is women’s development and security in the country.

Talking about the bank – the minister himself in his speech acknowledged the fact that, “Women are at the head of many banks today, including two public sector banks.” The question then is what is the logic of an all-women bank? Howsoever good the intentions may be, neither the minister nor the budget document makes it clear as to how the bank will encourage women entrepreneurs? Is an all-women bank the ideal solution? Will it disburse loans at lower rates or will the savings rates be any higher?

As for the ‘Nirbhaya’ fund, there is a general perception in the social media that the fund will rot in the ministry coffers as lazy bureaucracy would take ages to implement laws and tighten security measures. There are questions as to whether the fund will be used to set up better shelter homes and trauma care centres for rape and acid attack victims? Suggestions from various quarters are that- what essentially women need is development at the grassroot level– one of them being more toilets for women. What women really need is security. A few suggest that the minister could have allocated more funds to increase policing on the streets, as well as more female police officers. And yes, more money for rehabilitation and counselling for victims of physical and sexual crimes such as acid attacks, trafficking and rape, would be a better idea.

In previous budgets too, the concerns of poor and youth were addressed; but women being an integral part of the budget discourse is a novel idea. Those for whom the budget is meant want to know how the funds are going to be used. The minister has made the promises, there are suggestions – some of them can be addressed / incorporated - what perhaps could make or mar the entire effort will be the implementation part. If implementation fails, the budget with its inherent goodness as well as inadequacies will be deemed to be mere populist that fell flat.

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