The recent moves of the government to gradually deregulate the Petroleum, Oil and Lubricants (POL) sector in India as part of the agenda of ‘neo-liberal reform’ has generated discontent among the people. In the run-up to complete deregulation, there are instances of increase in the domestic price of POL products that are proportionately more than the rise in their international prices. In the most recent instance (of 13thSeptember, 2012), the diesel price was raised by Rs.5 per litre at one go, even without any rise in international prices.
The fiscal problem of West Bengal, in terms of a low Own Tax Revenue generation as a proportion of the Gross State Domestic Product (GSDP) and a high debt-GSDP ratio has generated a lot of debate in and outside the state. This article written by me and Zico Dasgupta is a modest contribution to this debate, published in Economic and Political Weekly. The article can be downloaded from the attachment below.
The Union Budget was placed by the Finance Minister in the Parliament on Friday 16th March 2012. Right in the beginning of his speech he mentioned that there has been a growth slowdown in the economy, the rate of inflation remained high and the fiscal deficit overshot the target. Given this situation of the economy, it was hoped that the budget will address these problems. The article tries to analyze how far the Finance Minister has been successful in providing solutions to these problems.
The third tier of the government, viz. the Municipal Corporations, the Municipalities and the Panchayats, is increasingly being told to become financially ‘self-sufficient’. This note provides a critique to this approach of financing the third tier of government.
'' The “bail out” package to the financial system in the United States is estimated to exceed $10 trillion. The strategy at present therefore seems to be to sustain the financial system and wait for the next “bubble” to appear rather than to revive the real economy directly through fiscal stimuli. The consequence of this strategy will be a prolonged period of recession and unemployment with much human suffering; but this only underscores the power of the financial interests in contemporary capitalism, where even a crisis of this magnitude engendered by their functioning leaves this power undiminished.''-argues Prabhat Patnaik.