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Panic not policy the reason behind govt's 100 % FDI move: Govindacharya

Atul Chaurasia | Updated on: 10 February 2017, 1:48 IST

The comment

  • Govt is moving towards opening up many sectors to 100% FDI
  • RSS ideologue Govindacharya thinks this is a bad idea
  • He says this is a panic reaction to the rise of China

More in the story

  • Govindacharya\'s take on Raghuram Rajan\'s exit
  • Why he feels India\'s Constitution needs to be overhauled

India is on the verge of becoming one of the most liberalised economies in the world. The government has opened up many new sectors for 100% foreign direct investment (FDI), including defence and aviation.

The country has come a long way from being a semi-socialist economy to becoming a leading market destination for international investors during the past 25 years. How relevant are ideas like 'Swadeshi' in today's scenario?

The Indian economy has also recently been in the news for other reasons. Some segments from within the government itself, launched a campaign against RBI Governor Raghuram Rajan leading to unnecessary speculations in international markets.

Catch put some of these questions before RSS ideologue KN Govindacharya, who has been a vocal opponent of liberalisation.

The former chief of Sangh-affiliated Swadeshi Jagran Manch had fallen out with the Vajpayee government over the same issue. Although, he is still active as part of the RSS think tank.

Q: The government has recently announced that it would open up several sectors of the economy to 100% FDI. You have been a critic of the open economy. How do you view this decision?

A: There are two-three aspects to this decision. Firstly, this appears to be a move to elicit the support of Japan and USA against China. Secondly, the government is now feeling the pressure of public expectations it had aroused. Some of these expectations are practical while others are not. The government lacks the capital to fulfill its promises. It needs money for everything and exports are coming down. The government seems to be perplexed. The latest decision looks more like a panic reaction.

The government lacks alternative ideas. It has not clarified how much FDI would be allowed in the sensitive defence sector. The same applies to the food processing sector. The government is not paying attention to the decentralisation of the rural economy. We have no structural mechanism to determine how foreign companies are going to be regulated. The effective implementation of government's recent decisions remains uncertain.

Q: What is the reason for this uncertainty? After all, the government belongs to your ideology.

A: No. This government doesn't belong to my ideology. Some people in the government might agree with my ideas, but it would be an exaggeration to suggest that all of them share the same thinking. The problem with this government's ideology is that it is not sure about its vision for society.

This government might appear to be more pro-active than its predecessors, but it is not qualitatively different from the previous dispensations. In fact, it can be better defined as another version of the UPA government.

It appears to be less corrupt. But, the centralisation of power is bound to have adverse consequences. It will eventually lead to the weakening of the legislature.

Q: The government also seemingly faces a crunch of talent. The appointments to institutions like NIFT, FTII & BHU have been controversial for the same reason. Does the nationalist ideology lack talented minds?

A: I have not pondered much over this issue. Public image is one thing and capability is quite another. The positive public perception of certain individuals has been carefully inculcated during the past 20-30 years. It doesn't mean they are talented as well.

Q: Who are these individuals?

A: I will not take any names. However, many persons have been appointed to high offices merely on the basis of their ideology. The need of the hour is to put in place a system for searching and grooming talent within our own house. A capable person will not simply walk up to you. You will have to search for such individuals. Otherwise, people with effective PR alone will continue to excel.

Q: There has been an intense debate over RBI Governor Raghuram Rajan. There is a general impression that the government has no appropriate replacement for him. A faction within the government was openly opposed to Rajan's continuation at the helm of central bank's affairs?

A: I believe there was a lot of unnecessary rhetoric over the issue. Several important aspects were lost in the din of the controversy. For instance, the issue of non-performing assets (NPAs) of banks should not remain restricted to Vijay Mallya, also there should be a balance between inflation and interest rates. Instead of addressing these matters, the government remained focused on theatrics.

Q: Do you feel Subramanian Swamy was wrong in launching an offensive against Rajan?

A: Swamy has his own style of functioning. Nobody can stop him. I feel vitriol against Raghuram Rajan was uncalled for. The politics should be based on openness and cordiality. Unfortunately, today's polity is dominated by mutual mistrust.

It would be wrong to blame one single individual in this matter. Anybody who comes to power tends to cross the Lakshman Rekha. This has become a trend and the current rulers are no exceptions. Successive governments only cater to partisan interests in the name of the mandate. This has been happening for the last 30-40 years.

Q: Some leaders of the ruling dispensation have tried to raise Ambedkar Vs Nehru debate. Are they right in doing so?

A: There are two important points to consider; Ambedkar had himself made some contentious remarks in the Rajya Sabha that are being quoted today. However, a deeper analysis reveals Nehru and Rajendra Prasad had played a more decisive role in the Constituent Assembly. Ambedkarji fulfilled his responsibility with integrity, but he was also backed by Gandhiji.

Gandhiji did not have much say in the making of the Constitution. There was an attempt to somehow placate him by inducting the clause for cow protection in the directive principles. The concept of 'Gram Swaraj', pivotal to Gandhi's philosophy, was totally ignored. Gandhiji remained silent at that time, hoping he would launch a movement to press for these changes in the future. However, destiny had something else in store for him.

Q: You have expressed reservations over the current form of the Constitution. According to you, what are the changes, necessary to improve it?

A: The Constituent Assembly represented only 14% of the total electorate. There was no provision for the voting right to every citizen above the age of 18 at the time of its inception. A few elite representatives chosen by the British authorities and princely states dominated the proceedings of the Constituent Assembly. But it was not inclusive.

We need to closely re-examine the current structure of the Constitution. For example, the policy of reservation for deprived segments has served its purpose. Now we should think about empowering the poor. The people dependent on natural resources for survival should get their due rights. We are still embroiled in disputes over displacement and compensation. Whereas we should have been planning a growth model based on ecology.

What is the Constitution? Its writ runs only up to the district administration. Only might is right at the lower levels. The bureaucracy must be overhauled. A family, not an individual, should be considered as the basic unit of society. The Constitution must be linked to contemporary social realities.

Q: Are you suggesting the Constitution does not represent Indian society in its current form?

A: Where has it been successful? The current constitution mandates 70 crore people living below the poverty line should get a monthly allowance of Rs 10,000. That is if the concept of a welfare state is a reality. But it has not been happening. It is not even possible to implement. This means there is something inherently wrong in our Constitution.

Q: You have recently reiterated the need for constitutional reforms. Are you working in this direction?

A: I am doing nothing. It is for the government to take the necessary action. It is the value system, not the Constitution, that is running this country. The institution of the family governs the actions of an individual. There are crores of unemployed youth in the country. A person without a job is supported by his family. The Constitution fails to deliver at this level. Infirm parents are fed by their children and family. The Constitution cannot even ensure the old-age pension of a paltry Rs 700 per month to them.

In other words, the unit of the family is governing the nation. We will have to change the Constitution accordingly. Besides Constitution, we must also think about reforming the judicial system.

Q: But there must be some positive things as well in our Constitution?

A: There are some positive features that need to be focused upon. It talks about the dignity of every citizen. It advocates positive discrimination in favour of the last man standing in the social hierarchy. The current Constitution is a step in the right direction. However, we need to make it more relevant.

Edited by Aditya Menon

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First published: 23 June 2016, 9:20 IST