The topic on India?s growth has always remained sacrosanct even when its economy has been in shambles. With the Aam Aadmi Party (AAP) now ruling?or serving the common man, as they put it?the national capital, the new chief minister is very well pleasing many, by fulfilling his promises of cheaper electricity and water, but the bigger picture is still missing, one that may burn a hole in the government coffers. The fiscal deficit is soaring and with increased use of subsidiaries, government funds are exhausting, making the situation worse than ever.
Arvind Kejriwal is trying to fight the symptoms without gauging the causes and this may not work in the long run. AAP?s decisions are based on emotional considerations rather than an economical point of view. For example, the AAP proposes that petrol and diesel must not be taxed but subsidised. How does it seek to answer the overuse of depleting fossil fuels like oil? Will it not increase the use of personal transport over public transport? The AAP suggests a blanket 50% cut in electricity tariffs. How does it explain any future financial burden on the power companies when they are already running into losses? Moreover, the AAP proposes that a system will be executed where people?s consent will be necessary for pricing critical commodities. Who wouldn?t then ask it for free?
With all the promises full of contradictions, the future of India seems bleak with the AAP ruling the national capital in courteous right of economic illiteracy.
Ashita Gupta
The author is a student of the International Management Institute, Delhi
