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Wednesday, February 3, 1999

Politics of prices

 
Managing the economy is tough business but managing the political fall-out of rational economic decision-making is tougher still, as the Vajpayee government is discovering. The shindig kicked up by the opposition parties and the BJP's own allies in the government over hikes in the price of essential commodities, LPG and urea, is irrational.

Thankfully, the government was able to resist these high velocity winds at least for the time being and sensibly decided to withdr-aw only the hike in the case of foodgrain sold to those below the poverty line. Subsidies have reached unsustainable levels and are threatening to send the nation's economy into a tailspin. As finance secretary Vijay Kelkar explained earlier this week, the government just could not afford a higher subsidy bill -- estimated to be something in the region of Rs 14,000 crore since it had already borrowed far more from the market and the RBI than the Budget had made allowance for.

The angry Opposition response to this development runs true totype. Parties like the Congress and the Samajwadi Party are, after all, looking for any stick to beat the BJP with and the rise in prices has always provided useful ammunition for anti-government campaigns. The reaction of the BJP's allies in government, however, borders on the reprehensible. By publicly waging a war on the issue with the government they support, and indeed are a part of, they have conducted themselves in a manner that is scarcely any different from that of the opposition.

It appears as if they have no real investment in the present government, so guided are they by their own narrow agendas and local concerns. While the Telugu Desam and the Tri-namool Congress have the excuse of only supporting the government from the outside, what justification do the Akali Dal or the AIADMK have to go on the warpath in this fashion? After all they have their representatives in the council of ministers who, presumably, are party to government decisions.

If this isn't a telling example of wanting to haveone's cake and eat it too, what is? Take Punjab Chief Minister Parkash Singh Badal's stand at Tuesday's coordination committee meeting. After demanding that the government withdraw the proposed hikes, he proceeded to dwell at length on how the Centre should bail his state out of the financial mess it is in. Has someone explained to the chief minister that the coordination committee is primarily to facilitate better participation of allies in government functioning at the Centre? That it is best to raise state demands at the chief ministers' conferences that are convened from time to time?

There are lessons in this for the BJP too. For starters, it could certainly do with a course in media management while handling unpopular and intractable issues. Efforts must always be made to educate the public on the various compulsions facing the government and the reasons why it is forced to take the various steps it does. Public opinion is a great ally.

Kelkar's delineation on the state of the economy was useful butit came much too late, alas. Here, the Vajpayee government should learn a lesson or two from the manner Chandrababu Naidu withdrew prohibition in Andhra Pradesh. Prohibi-tion, it may be recalled, was one of the planks on which the TDP had come to power in the state. Naidu was therefore careful to first create public opinion in favour of abolition, before actually taking that controversial step.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.


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