'Some of the policies NITI Aayog has taken, we feel lean towards the corporates.'
'In a democracy, when you are making a policy decision, you are expected to take the views of all the stakeholders.'
Dr Ashwani Mahajan, co-convenor of the Swadeshi Jagran Manch, is an associate professor of economics at Delhi University. He has been extremely upset with the NITI Aayog ever since it supported GM (genetically modified) crops.
The SJM has decided to convene a meeting of all stakeholders involved including members from NITI Aayog and conduct an audit of the institution through discussions and debates on January 10.
Dr Mahajan explains to Rediff.com's Shobha Warrier why the Manch -- which is aligned with the Rashtriya Swayamasevak Sangh -- is unhappy with the NITI Aayog.
Why does the Swadeshi Jagran Manch want to audit NITI Aayog? Do you feel there is something amiss there?
It's not exactly auditing NITI Aayog. We want to discuss whether the institution has done what it was supposed to.
NITI Aayog was constituted two years ago in place of the Planning Commission with a certain objective.
There is a preamble on the Cabinet note based on which it was constituted just like the Planning Commission. The preamble describes the objectives of NITI Aayog and why it was constituted.
Now that two years have passed since the inception of NITI Aayog, we decided to organise a round table conference to discuss and deliberate on the issues that have taken up by NITI Aayog in the last two years.
We want to see whether it has fulfilled the mandate that was given to it.
In a democratic set-up, this is the way forward.
If we see that there is something lacking in the direction of policy making, such discussions will help correct the direction.
Who are the people who will participate in the conference?
We are requesting economists, members of NITI Aayog, policy makers and various stakeholders.
NITI Aayog has come out with reports on GM crops, health, poverty alleviation, manufacturing etc.
So, when we say stakeholders, we mean people who are directly and indirectly affected by these reports, like the farmers, workers and civil society.
This conference on January 10 will have three sessions, the first will discuss the constitution of NITI Aayog and what was expected from it, the second session is titled 'Meeting the Mandate', and the third session is on the way forward.
I want to stress that this conference is not against anybody or in favour of anybody; it's only to discuss and deliberate whether NITI Aayog has followed the mandate and what should be the way forward.
Reports say the SJM is dissatisfied with NITI Aayog's so-called corporate leaning policies. Do you feel the Aayog leans towards the corporates?
Some of the policies NITI Aayog has taken, for example on GM crops, we feel lean towards the corporates.
Firstly, whether an issue like GM comes under NITI Aayog is not certain.
And when they come out with a report, it becomes very important as it is the only think- tank of the government that makes suggestions and recommendations on various policy issues.
The entire structure and decision making of NITI Aayog is based on the spirit of corporate federalism and it is expected to follow this.
It is expected to deliberate a subject like GM with the state governments as agriculture is a state subject.
NITI Aayog should have discussed the issue with various state governments and found out their views and expectations when there are so many diverse views on GM.
In a democracy, when you are making a policy decision, you are expected to take the views of all the stakeholders.
Even if there is one voice against the decision, it has to be heard.
In the case of GM, there is not one, but many voices against it.
The technical committee constituted by the Supreme Court had recommended a moratorium on GM crops for the next 10 years because the regulatory mechanism was not in place.
The report made by a Parliamentary Standing Committee also suggested that India should not opt for GM.
In spite of that, NITI Aayog came out with the view that there was no scientific basis to the opinion that GM was bad.
How do you think GM crops will affect Indian agriculture and farmers?
GM is against organic farming.
If you have GM, you cannot have organic farming as they are from the opposite spectrum.
The major worry is biodiversity will be in danger if you have GM crops.
In short, GM is a danger to the environment, human health and biodiversity.
And there are issues related to the livelihood of the people too.
So, there should have been more debates and discussion before giving a nod to GM crops?
We would expect a much deeper and wider understanding from an institution like NITI Aayog.
If the Aayog had approved GM crops after listening to all the stakeholders concerned, what would the SJM have done?
But the fact is they did not do so.
Our concern is they did not listen to anyone and they were not interested in doing so.
This is not the way to go ahead with a serious issue like GM crops.
Why didn't they write to the state governments asking their opinion on, for example GM mustard?
Do you feel NITI Aayog is undemocratic?
I don't want to make such a sweeping statement about any institution, but the GM report and many other reports give a clear indication of the kind of way NITI Aayog functions. That's why we are arranging this discussion.
Unlike NITI Aayog, we are not organising it with any pre-conceived notion.
We have invited everyone including the members of NITI Aayog and people from the political class.
When NITI Aayog was constituted, we welcomed it as the idea behind it was till then all the planning was done by a central planning commission and also at the top and implanted at the bottom level irrespective of the requirement of the people.
Every state has different requirements which the Planning Commission never understood.
When NITI Aayog was constituted, the prime minister himself said it would listen to all stakeholders and all the state governments and would put all the ideas in policy making.
But it did not function the way it was expected to?
Yes. It was expected to function based on the preamble in the Cabinet note, but it was not followed.
But we are not trying to be judgmental on this before the discussion.
It is true we are not happy with certain policy decisions and the functioning of the institution.
After the round table conference we have arranged, everything will be in black and white, and we will come out with a report.
'It will take time for the Indian economy to move from cash to cashless'
How does the SJM look at demonetisation? Do you think this will flush out black money from the system?
We feel this is a good decision, so we welcome it. It cannot be taken by a weak or a dishonest prime minister.
Yes, there are some problems because of the paucity of cash and this has created problems mainly for people who are into small businesses.
It is also affecting the economic activities of the country.
We feel it is a short-term problem and in the long run, there will be many benefits coming out of it.
One: Fake currency, which was going out of proportion, will come down. It was helping terrorism too.
Second: The reduction in the use of cash will help us combat inflation.
This will be followed by a fall in rate of interest.
With a fall in the rate of interest, investment activities in the industry and infrastructure will start.
In the last 7, 8 years, our capital formation was coming down, from 38% of GDP to 31% in recent years. It was a point of worry.
As a professor of economics, I feel it will happen and this will kick start a chain of benefits to the economy, especially the poor.
Do you expect the government to invest in infrastructure projects to kick start economic activities?
I expect the government to invest in tbhe social sector and also in infrastructure projects.
When the rate of interest comes down, even the private players will start investing.
Because of demonetisation, most of the black economy in the system would turn to white, increasing the revenue of the government.
I don't totally disagree with Dr Manmohan Singh when he says there will be a reduction in the growth rate, but I disagree with him in the percentage.
I feel the growth may come down by 1% and not more than that, and this also will happen in the short term.
I expect lower growth will be over in this fiscal year itself.
We can easily absorb this reduction in growth for 1 or 2 quarters as we had more than 7% growth in the earlier quarters.
Do you think people will have the patience to wait for 1 or 2 quarters?
I see impatience in the media and not among people.
So far Rs 5 lakh crore new currency is out in the market and in another month, another Rs 4 lakh crore will be out.
If the currency is replenished by the government, the cash crunch will disappear.
Soon, the RBI also will lift restrictions on cash withdrawal.
Because of the cash restrictions, business in the SME sector is down 50%, they say...
Ours is a cash economy and it is expected to come down when cash comes down from 100% to 15%.
But there are certain disadvantages to the cash economy, mainly in the real estate sector.
Hoarding of food grains happens only because people have cash.
That is why the prices of pulses have come down drastically in the Delhi wholesale market now.
Is India ready for a cashless economy?
I feel 100% or even 50% cashless is not possible right now.
It will be a gradual process. It all depends on the habit of the people, on what they are comfortable with, on whether they prefer to use cash or cheque or digital money.
Habits die hard. So, it will take time for the Indian economy to move from cash to cashless.
But in the name of cashless, we should not support multinational companies with foreign capital.
We also may encounter risk of data theft.
That is why we object to Paytm which has Chinese capital investment.
We should promote our own payment system.