INTERVIEW: YASHWANT SINHA
"Nobody will have a monopoly" Two hours after presenting his interim Budget,the Union finance
minister met Senior Editor Sudeep Chakravarti
and Special Correspondent Shefali Rekhi
in his office. He was mostly guarded -- an old habit -- citing a need for budgetary
secrecy, propriety and consensus, but hinted at a plan of action. Excerpts:
 What happens now?
I am committed to bringing the fiscal deficit to reasonable levels.
What is a reasonable level?
I'm unable to define it yet. We have to apply our minds and work out a
strategy. I believe you can control the fiscal deficit and still inject growth.
How do you plan to get the money for this?
There are ways. It's only that it need not always come out of the budget. I can't
elaborate on it yet.
Will you raise import tariff? Taxes?
I am not in a position to answer that yet. I have not even applied my
mind, but these are issues that I will address in my regular budget.
Will you change the disinvestment policy to make it
more effective?
I am not looking at PSU disinvestment as a revenue windfall. psu disinvestment has
to be necessarily related to PSU reform. I am a great one for the unit by unit approach.
There are PSUs that can weather competition, operate profitably. There are some PSUs which
can't. So we will have to work out an overall policy as well as a policy for individual
PSUs.
What about forcing real change?
Public-sector management will be responsible to public-sector boards, which will
not necessarily consist of joint secretaries and additional secretaries to the government.
There will be equity shareholders who will be asking tough questions. I am a votary of
cutting the umbilical cord between the public sector and government.
You talk of kick-starting the economy. What do you
propose to do?
I don't use the phrase because I like it, but because I believe in it. If you don't
spend money in large projects in the public or private sectors, then at some time or the
other the economy will slow down. If you do, then it will be possible to kick-start the
economy. In turn, this will create demand and feed other industries, and so on.
That could take between three and five years to get
going.
I'm talking about the next six months. I'm talking about clearing power projects,
for example, which have been held back for some little clearance here or there. I'm also
looking at a whole range of public-sector projects which can be financed outside the
budget, like rural roads.
Are you going to cut the size of the Government?
I can't be talking in specific terms about a lot of things now, but I will in the
budget.
What about subsidies? They are bloated.
We are not looking to continue with subsidies, but target it better.
Somehow it doesn't add up.
It will fall into place when I present the budget. Please understand the delicacy
of the situation. As a political party, we said one thing. Now as Government, we are not
saying that we are going back on what we said. I'm just saying the proposal of the
Government has to be presented to Parliament in the budget.
What does deregulating domestic industry mean?
We can't leave it as vague as saying priority and non-priority areas and leave it
to some secretary in the Government of India to decide it. We're committed to making the
investment regime transparent, cutting out the hassle factor, making the investor's life
simpler, more convenient. Indian industry, whether it's private, public, cooperative or
joint sector, must be exposed to competition. But I will appeal to you not to project a
negative image. I say all right, I want $2 billion of foreign investment in
infrastructure. But if I say no to someone bringing in $10,000 for spectacle frames, does
that mean I have a negative feeling towards foreign investment? Let's not get into this.
Let's not create a scare.
Then why keep saying things about potato chips and
computer chips, for effect?
Nobody in the Government has been saying that. These statements were made before
people got into government. What we are basically saying is that we are against all-out
consumerism which can create further social tension with income disparities. We are
interested in giving the Indian consumer the best possible deal, whether it's a product or
a service. And where it's not possible to ensure such competition within the domestic
sector, we will certainly welcome foreign investment. Nobody will have a monopoly of the
Indian market.
How will the revenue shortfall affect your plans for
growth?
I am hoping the economy will come out of its present difficulties in the next few
months and our revenue will look up.
Are you going to increase the tax base?
I'm not going to answer that.
Is the tax base sufficient?
If only 10 million people pay tax who can say that base is sufficient?
Maybe reforms should begin with this ministry and its
mindset.
A. I agree. I will see to it that the change in the mindset takes place. |
