Edits

Editorials

India Today
October 19,1998

Trust the Market

Costly onions are the upshot of irrational governance stifling rational economics.

Edits Statistics have never been so stark. In November 1997, onions could be had for Rs 10 per kg. In November 1998, prices are expected to reach Rs 70 per kg. Explanations have kept pace with inflation. Unseasonal rains in winter ruined the crop. A heat wave in summer ruined the crop. Farmers reduced onion acreage, causing lower yields and higher prices. Profiteering traders contrived the scarcity. The Government's buffer stock was inadequate. In actuality, the truth is about all these factors-and about none of them. What India is guilty of is a complete failure to anticipate the demand-supply equation. As early as December 1997, when onion prices had touched Rs 20 per kg, it was clear a crisis was brewing. Yet, the Ministry of Agriculture remained smug, confident that if the problem were ignored long enough it would disappear.

It was then that the decision to import onions should have been taken. Instead, the Government continued to sanction the export of onions till well into this year. When the import order was finally placed a couple of weeks ago, it was a case of too little too late. At 15,000 tonnes, the onions coming in from Dubai and Iran will barely meet the needs of the four metros for a month. In sum, India is paying for institutionalising a system which is so distrustful of the market that it completely ignores even elementary economic laws. For a start, the Government presumes it has a monopoly on commercial wisdom. Plans to import are delayed to a point where they become virtually useless and where the international commodity trade knows India is desperate. The result is India buys at high prices and bureaucrats and ministers face bribery charges. This has been the precise recipe for repeated sugar scandals. The politically influential farm lobby too is happy as it has been allowed to make a killing. As for the hapless consumer, she is left in tears even if there are no onions to chop.

Those Unpaid Bills
Becoming an MP isn't the same as getting a credit card with no limit

It is a measure of India's comatose governance that the Bombay High Court has directed the Lok Sabha and Rajya Sabha secretariats to withhold salaries and allowances of those MPs who have unpaid telephone bills. The need for this order should not have arisen at all. Under the Members of Parliament Act, 1957, the secretariats already have the authority to so punish defaulters. Collectively MPs have a Rs 14.15 crore outstanding telephone bill. If the money due for water and electricity and to the outlets of the state-owned India Tourism Development Corporation is added, the sheer criminality becomes even more apparent. If democracy is about equal treatment under equal conditions of culpability, a number of MPs and former MPs should be behind bars, their creditworthiness reduced to zero. Of course, nothing of this sort is about to happen. Rather, it will be a miracle if politicians don't raise an alarm about the court's order threatening parliamentary privilege and seek new avenues of escape. Despite such cynicism, it must be admitted that the judicial verdict seems quite watertight. With the backing of the presiding officers, the secretariats can yet implement it.

A petition moved before the Delhi High Court calls for a similar resolve. It seeks to penalise Mulayam Singh Yadav for having misused official aircraft during his term (1996-98) as defence minister. Mulayam made over 300 trips on Defence Ministry planes. A third were to Lucknow, Etawah and Mainpuri-his political territory. It is time to put in place a rule that ministers must use commercial flights-even trains, for short hauls-unless the destination is remote or there is a patent emergency. As for the telephone and electricity bills, there's no harm done if guilty legislators have their salaries taken away. Taxpayers shouldn't be expected to bankroll freeloaders only because they are MPs.

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