We are already seeing green shoots when it comes to economic recovery. Thank you everyone for joining us today. This is the second conversation in the four-part discussion series co-hosted by Nils Klick and Center for Financial Accountability. In the last few months, media has been talking about rapid recovery and rapid growth for the Indian economy. This series is an attempt to interrogate those claims by questioning how much of these claims actually hold true when confronted with reality and how much of it is just a number game. What has actually recovery meant for the people and what should a meaningful recovery look like? Well, in the first session, we looked at several of these numbers and claims. In the second session titled evaluating the government's steps towards recovery, we will evaluate each of the government's supposed steps towards propelling this recovery. From Atnirbar Bharat to the proposed infrastructure drive from the reforms to the monetization of assets, we will try to confront the claims with reality and region. On 6th of December, we will discuss what has recovery actually meant for the people. And on 10th December, we will be discussing what should have a people-centric recovery meant. This series is being moderated by Paranjoy Guha Thakurtha. He is a senior journalist. His main areas of interest are the working of political economy and the media on which he has written extensively and has also made documentary films. He is a teacher, anchor, speaker, interviewer and writer. He has served as the editor of Economic and Political Weekly and has been a consultant with NewsClick. We are thankful that he has agreed to anchor this series with us. Given the demagoguery and high decibels in the newsrooms, we have been turned into a country that lives in a short bust and even shorter memories. The hardships of the lockdown, the complacency and the debacle of handling the second wave, the bodies floating in the rivers and the migrants on the streets are already being erased from public memory while economic policies are geared towards favoring big capital. In such a context, this series is a part of our efforts under Economy Pechacha aimed at allowing more public discussion around the issues of finance that catch each of our pockets and prospects. Now I hand over the stage to Paranjoy for his initial remarks for introducing the panelists today and for taking the discussion forward. Thank you very much Ashish for that introduction. And I think you have very, very succinctly and articulated the theme of this four-part series of discussions. I want to thank the Center for Financial Accountability and NewsClick for putting it together. And it's really important that those who are viewing, those who are listening to our speakers get to know the facts, get to analyze and interpret the facts in a manner which is different from what is being claimed officially by the government of India, by different ministries and departments of the government of India, its ministers and its citizens. And I think it's very important to interrogate the rationale behind these grand schemes that have been announced. Exactly. 2020, middle of 2020, Finance Minister Nirmala Sita Raman, when there was widespread criticism that the government was not spending enough to provide relief to not just migrant workers but the poor of this country when the COVID pandemic had peaked. She announced this grand plan in a series of installments which is 20 lakh crore and that was supposed to be like 10% of India's gross domestic product because everybody is saying look how much these different countries are spending, look how much the United States is spending and we are spending a bit. But when one started looking into those figures, you found that the new part of it was just about 2 lakh crores. So instead of 20 lakh crores, it was one-tenth of that amount that was additional, that was new and everything else was recycling of the old schemes and existing schemes. Now the government has announced some grand plans of privatizing public sector undertakings as well as the national monetization pipeline which is intended to allow the private sector to lease assets and monetize assets that belong to the public sector. So we are going to start with looking at these three broad issues and we will go deeper into some of the specific areas production linked incentive schemes, support to small, medium, micro, small, medium enterprises. We are going to look at different sectors including the foreign direct investment policies of this government and a whole lot of other issues. So let me quickly introduce the panelists who are here with me on this panel. We have a senior economic journalist and we have two professors. I am very happy to welcome V. Sridhar. He is a senior economic journalist. He has been following these issues very, very closely for more than three decades. He has been associated with actually a part of the Hindu group of publications. He recently retired as associate editor of Frontline and he is far from actually having retired. He is neither tired nor retired. He is going on and on and he is writing and he is commenting and he has been an active part of the People's Commission against privatization of public assets. He continues to write and engage on this subject. Thank you so much, Sridhar, for being with us on this occasion and we are very happy to have with us Professor Chirashree Raj Gupta. She is a professor at the Center for the Study of Law and Governance at JNU, Jawaharlal Nehru University. Her areas of specialization include the political economy of institutions, economic history, institutional economics, the history of economic thought and on these subjects she has written extensively and teaches these subjects and she has been writing a lot on the concerns relating to the working of the public sector in India. Issues relating to big business, corporate liability, fiscal federalism and so on. Thank you so much Chirashree for being a part of this discussion. And with us here is Professor Shuroji Majumdar. Professor Majumdar is at the Center for Economic Studies and Planning at also at JNU, the Jawaharlal Nehru University. He's been very active in studying the working of the political economy, the industrialization process, the corporate sector and questions relating to regulation, deregulation and under policies of so-called economic liberalization. And he's also been critically evaluating the growth model under globalization. So I thank all of you and let's really start with Sridhar and then I'll come to Professor Chirashree Majumdar and then Professor Shuroji Majumdar. And let's start with this grand plan, national infrastructure pipeline. And everything is supposed to be first of a kind, everything is supposed to be like the numbers are humongous and the most recent announcement pertains to what is called the asset monetization, the monetize NMP, the National Monetization Pipeline, which is really and here I'm quoting the Finance Ministry for one of its official releases. It says that in the wake of COVID-19 there is a pressing need on the public outlay towards social sector priorities and economic stimuli initiatives. Thereby necessitating exploring alternative mechanisms such as asset monetization with increased vigor. So the whole National Monetization Pipeline is being justified as enabling the government to spend on the social sector. Now, I'd like Sridhar to comment on what this is all about the National Monetization Pipeline. It's listed out all the assets, the asset classes, the various infrastructure ministries and all of these are supposed to be monetized over a period of time. So over to you Sridhar, please unmute yourself, please unmute yourself. Thank you Paranjoy and I'd like to thank NewsClick and the Center for Financial Accountability for having me on this show. Paranjoy, I think we need to situate this, I mean as a journalist we are used to using pegs and the peg now is the GDP and since this show is about interrogating the recovery and I would like to look at some of the numbers that the GDP latest figures show. If you slice national GDP across its expenditure categories, private final consumption expenditure which is the largest portion of GDP, government final consumption expenditure into which it's not just the running of the government but also social security and various other schemes through which transfers payments are made and gross fixed capital formation which is a marker of investment. Now if you ignore for a moment the headline numbers which has been in the media that's the 8.4% growth rate and actually look at the levels of GDP prevailing in 2019-20 that is before the pandemic. Then you have a measure of, you have a better measure of whether and how far the economy is actually recovered. The reason I am doing this, I am aware that earlier in the other segments of this show you have looked at the numbers more closely but the reason I am highlighting this is that private final consumption expenditure has declined by 7.7% in the two year period we are talking about. Government final consumption expenditure has declined by 7.83%. Gross fixed capital formation has declined by 8.2% that means the investment is just not picking up, it's not happening. Now these three components account for the overwhelming proportion of your GDP, national GDP so we are talking about a real problem. Now the fact that capital formation has declined so significantly, so sharply indicates a few things. It shows that and the reason I am citing this is to link it to the privatization and disinvestment and privatization and the monetization pipeline in the sense that these actually are likely to subvert any worthwhile recovery that can happen in the piece. The potentialities of a recovery are probably being sabotaged by this. Now I will explain why I am saying this. One of the ways of initiating a recovery because private investment has not been forthcoming and we have the finance minister just recently almost pleading with private industry to take risks and invest and that is not happening. One of the ways to counter this would have been to use the potentiality of public sector undertakings to initiate a recovery. And that's not happened. Instead we have had dividend payouts by the public sector undertakings as well as the RBI. The figures that I am quoting includes those from the RBI as well. But they have increased from 2.4% of GDP in 2014-15 when the Narendra Modi government came to power and now it is in 2021 it was 4.1%. The government has been sucking out the profits of the public sector undertakings which have never depended on the government budgetary support anyway and reduced the possibilities of them plowing back investment to initiate a recovery during this pandemic. That is the significance of the decline in capital formation. So instead of using the public sector as a vehicle for a recovery we are actually going the other way and that's really worrying. Now the monetization pipeline, the privatization what it does is that it results in very little additionality of investment. I mean I am well aware that Air India is not the typical public sector undertaking but nevertheless it illustrates some of the things that are problematic. And I mean why investment may not be forthcoming even if it is under a private enterprise under the control of a private company. For example Air India, Air India is now because the Tatas have acquired Air India they are now in an oligopolistic, the domestic airline market is in an oligopolistic market now. Between Indigo and Air India effectively they hold a 75% market share. Now any elementary theory of firm I mean will tell you that oligopolistic behavior in terms of investment is very different from a market that is exposed to competition. So it is not as if the Tatas are going to invest heavily in the market because they are going to look for profitability and in an oligopolistic situation. Now that is one. Secondly, even the investment that the Tatas have made I mean while purchasing Air India is heavily loaded in terms of debt. Now Air India has been sold for 18000 crores of which the Tatas are paying just 2700 crores and they are going to control 13-14% of the Air India's domestic market share. Including Vistara and Air Asia they effectively control about 23%, 22-23% of the domestic market. So now the pricing power they get will not make them invest in airlines because Air India has a much bigger fleet than these other two smaller companies that Tatas already control. So investment is very unlikely to come. The point that the fact that it is heavily loaded in terms of debt means that even the investment that is going to come is going to come from the banking sector. It is not going to come from the Tatas. On top of this, since the Tatas, since debt enjoys certain very significant tax breaks, the actual revenues to the government may be even less because there will be an outflow of revenue from the government extractor for these tax concentrations. So the point is that if you are allowing, if privatization essentially is a transfer of assets which does not necessarily result in fresh investment in new capacity. So the productive capacity in the economy is unlikely to increase significantly as a result of privatization or disinvestment as it is politely called. Coming to the monetization pipeline, you see most of this, the government expects the Nitiayog paper says 6 lakh crores worth of assets. Now, even that is not very clear whether those are actually valued at that. I mean, when the private companies bid for these leases, whether that is going to actually materialize is something that is a very major imponderable. Even if you were to assume that these are valued at 6 lakh crores, when a private investor takes an asset on lease, he works out the value of what is called the net present value of the returns from that investment over the lifetime of the lease. In this case, it's 25 to 30 years. Now, that will be typically and then there is a profit margin and so on and all that. And so typically if you ask people in the banking industry, they will tell you that it will be about only one fourth of this value. So what is being touted as a 6 lakh crore asset leasing program is actually going to be not more than one. I'm assuming that this 6 lakh crore valuation will actually materialize even then it's going to be only 1.5 lakh crores. Now, doing all this for what? Remember this 50% of the assets that are on the block for leasing are railway and road assets. None of this and these are what are called natural monopolies and so none of these are what are called natural monopolies meaning that like for example, if you have a station in Chennai which is being handed over to a private contractor on a lease. Now that, I mean it's not a competitive market in the sense that Chennai can only have so many stations, railway stations. So effectively you are handing over this asset over which the private investor will have monopoly control. I like for example, if Chennai Central is say privatized, what happens? There is the private investor who is taking this on a 25 year lease is unlikely to, this asset is already built. The investment that needs to be made is very likely to be just cosmetic. And in any case, that investor not only is it going to be marginal, the incentive to actually invest is going to reduce over time. Because he is not interested in investing in the asset and also likely to flock the asset. Okay, I'm interrupting you Sridhar. We're going to get back to you and you've discussed several very, very important issues. And I'd like both Professor Chirushri Dasgupta and Surajit Majumdar to comment on some of the points you made. If I can briefly summarize some of the main points you made. I mean firstly you said that this headline number 8.4% GDP is misleading. Because there are major, major decline, I mean there is a major decline in expenditure, gross fixed capital formation, government expenditure, private final consumption expenditure and so on and so forth. And if I may briefly add, this is on a low base. We've discussed this in greater detail, all this is on a low base. Because according to the government's own statistics and we can dispute those statistics in April, May and June of 2020, India's economy shrank by almost 24%. And in the following three months it shrank by another 7.5%. This has never happened in this country before. Can I interrupt you for a minute? Which is why I use the level of GDP, not the growth rates. Correct, absolutely correct. You're going to get a chance to elaborate on these points. But I think Chirushri, the main points that he made is that instead of using the public sector to ensure that the economy recovers, what Sridhar is out doing, it's sabotaging that recovery. That you're creating oligopolistic structures including in the airlines business, Air India. I mean, look, you have a serving member of parliament belonging to the Bharti Janta Party, Dr. Subramaniam Swami, who goes on record saying that the entire bidding process, it's not my language, but his language was quote unquote rigged. And then you have the public sector being sucked out, dividends being taken out of it. And these are really some of the main points that Sridhar has made. And I'd like you to elaborate on these points and add your observations. Over to you, Chirushri Das Kapoor. Okay, thank you. The first point I would like to make is what Sridhar said that most of this is road transport, highways, railways. But apart from that, let's point out that there's power, there's pipeline and natural gas, there's civil aviation, there's ports and waterways, telecom, food and public distribution, mining, coal, housing and urban affairs. So the bulk of the urban economy and a substantive bulk of the rural economy, all the public sector assets that are there are up for backdoor privatization through this thing called the national monetization pipeline, which essentially says it's a lease and not sale. And the so-called aim has been to, if you look, go through the documents, the two volumes that have been published on this by the NITIO, is to generate employment growth and integration of the economy. And it's called a structured contractual partnership between the government and the private sector. And the reason it is being done, and this is where Sridhar's argument is absolutely spot on in contrast to what is being claimed, the reason it is being done is because of the private sector's resource efficiency. Now we have a long kind of theoretical literature which shows that this is bunkum, that there is no reason to believe that the private sector is more efficient than the public sector. There are problems about the methods of measuring efficiency, etc. Leaving those aside, now the interesting thing is that this whole thing will be done through setting up of two trusts, the infrastructure investment trust and real estate investment trust. Now who will be the trustees? What is going to be the institutional structure of these trusts? None of this is really clear. And these are going to monitor sales over short period. The terms of contract, the details of assets are not known. Yeah, as Sridhar pointed out, that valuation, where it comes from, it's not there in the documentation. So how they have arrived at it is not clear. Now the state of infrastructure, once the period of lease is over, the period of contract is over, what is going to be the state of infrastructure? For example, Sridhar's example of the privatization, the sort of leasing of Chennai Central and then let's say 30 years down the line, what will it be like and what will be the return reinvestment on what terms. So without going into any working out any of this, the entire project is sort of a big, is ambitious, but suffers from short termism. That's the first thing to say. Now I'm not going into the arguments against privatization at the moment because as you said we will do it separately. But as Sridhar says, I completely agree with his numbers. According to my calculations, in the four year period that they are projecting six lakh gross, it is not even going to be 1.1% of GDP, what we are going to get back in terms of the return. And this is an overestimate because if GDP grows at the rates that are being claimed, then it will be even less. So this is just turning all public sector assets into commodities without really having any kind of planning or vision about what is going to be the use and utility and value of those assets. Now on the other hand what I would like to point out, and this also comes out from Sridhar's figures about final consumption, that demand contraction has been the main feature of this entire period of crisis. And it is not just the last three years, this is something that is much longer for almost a decade now, demand has been contracting in India. And under such, and if there is this kind of privatization through sort of leasing of assets, the first thing that will happen is that user charges will go up, profit margins will be increased as Sridhar pointed out, and there will be shift from wages to profits, they are likely to be cuts in employment. So employment in the public sector is going to go down, and all of this will mean that it will further reinforce the demand contraction that is already there. Apart from that, the other point that I wish to bring in in terms of political economy is that this is fundamentally anti-democratic, because it has, it is fundamentally anti-federalism, because this a lot of the infrastructure, for example, state highways, etc., are not just the assets of the center. Similarly, a lot of the areas that have been included, including food and public distribution, housing and urban affairs, the states have a lot of stake in that, both in terms of investment and in terms of policy. So I do not understand how such an announcement can even be made without consulting the states and bringing them into the conversation. And we have seen different such attempts in the past. We have seen in the early 2000s how the attempt to privatize electricity in UP failed. We saw what happened to the PPP model of water privatization in Tamil Nadu. And so what happened to, and if we take international example, what happened to the railway nationalization, denationalization, privatization in the UK and they are now being forced to denationalize parts of it. So all of this actually shows that this is some, this move is sinister. And the reason I say sinister, because once you compare this with what has been happening recently, in terms of the centralization of corporate profits of just 20 companies accounting for more than 65% of corporate profits in financial year 2021-22. And it was even larger the year before, 72%. It is a way of, as Sheetha pointed out from his air India example, it is basically handing over national assets, which are going to be used for the use of the people to the corporate sector for a song. And so the sort of transfer, the resource transfer that will take place through this is basically giving, handing over the corporate sector, the entire public sector infrastructure for free, to the extent that the likely investment as Sheetha says is going to be very, very less. So I'll stop here. Professor Chirushree Das Gupta, you've raised several points. And I'm going to ask Surajit Majumdar to elaborate on some of these points. I think the main point, which he's repeatedly emphasizing that this government is ideologically motivated in a manner which says public sector always has to be bad and inefficient and private sector necessarily has to be good. But in the process what is happening to use Chirushree's language as sinister move to transfer resources, essentially that belongs to the people of this country to a bunch of oligarchs. I'm using that language and the whole policy of releasing assets, not only are the numbers highly inflated, but it's a form of backdoor privatization of infrastructure in this country. There are a lot of, I mean, how these assets are being valued, who are going to be the trustees of these trusts that will oversee this in this kind of leasing of assets is all very, very unclear. This is a government desperate for cash and resorting to desperate means at the end of the day, problems of unemployment, problems of recovery will not be resolved. And I must add one point before I come to you Surajit and this should be very clear to all those who are viewing this program. Center for financial accountability made several attempts to speak with people who do not agree with the three of you ideologically. Spokespersons of the government, economists of the government, people who are otherwise, who justify everything that the government is doing or at least justify some of the programs and policies of the government. And I must tell you, despite several attempts and different several attempts to contact these individuals, I don't want to name them. I know I personally passed on the telephone numbers to those who are working in the center for financial accountability. They were not interested in a debate. They were sometimes impolite in telling them you're not interested. So in a sense, the government doesn't even want to discuss anything, whether it be the farm laws, whether it be the national monetization pipeline, etc, etc. I stop Surajit over to you. Thank you, Paranjai. Well, Frida and Chirashree have already highlighted some of the key features of what is really behind this national monetization pipeline. I'd like to begin with what you said that the supposed ideological slot of this current regime where it seems to argue that the public sector is inherently inefficient and private sector is inherently efficient as a cover for handing over public assets or national assets to the private sector. I go a little beyond that in saying that it's also a cover for a reality which is actually the exact opposite. Because what you are seeing in the form of this national asset monetization pipeline is yet another instance of the big private capital being rewarded, not for having delivered on its commitments, but for having reneged on that. Repeatedly, we have been seeing this scenario where the private sector or private capital reneges on its commitments. And in the name of inducing private investment in the name of promoting investment, they are rewarded for that. So for long period of time, we have had an economic policy framework in which the, which sector of the economy is placed at the center of that process as the one which leads any growth and development process. That has been private capital and private big capital in specific that they are the wealth creators, they are the job creators, they are the employment creators. So policy has to be designed towards encouraging them to invest and grow the economy to create wealth. This was the, this is the commitment, this is the framework in which economic policy is being, the reality is what? That at least for 10 years now you have seen this investment has been stagnating. They have not invested. They may talk about the great future of India, but they are not investing in that future. We have had this scenario where employment opportunities in any case very limited have been shrinking. Employment proportion as the proportion of the working age population has been declining. So you place them on an elevated status that they will drive the growth and development process. You gave them several benefits and concessions in the name of that including tax concessions, other kinds of concessions. You can get land cheaply, you can get other things cheaply. But they have not delivered in terms of even investment which is maybe for their own profit, forget about employment and growth for a long period of time. It is not one year, two years, it is more than 10 years that this story has been erected. The idea of pushing growth through private investment has gone so far in India that even in the last decade you said even for infrastructure development, which even in the most private oriented economies often is considered to be an area where public sector investment is important. You went to the extent of saying that no even that area will be led by the private sector. You made public sector banks finance what was supposedly private sector investment in infrastructure and you landed up in this decade with the problem of non-performing assets in the public sector banks for which now their public ownership character is being blamed that that is the reason why they are having this particular problem. Now when that process also fails, what do you do? You say, okay, we wanted private sector to invest, we wanted them to also invest in infrastructure, they couldn't do that. Okay, so let what the public sector has invested the assets created by that, let's give it to them to operate. And investment business, if it has to be done, whatever measly amount they give to us will direct that towards investment and asset creation. So public sector will bear the burden of the risk of investing first in any particular asset. Once that asset becomes something which can pay, which is therefore attractive. They have no shame in even using that kind of language in the documents of the, it is attractive to investors. Then you say take these and operate them. And when you have milked these assets to the maximum possible extent and they have been run now, the possibility of getting any return out of them have been fully squeezed out. Then you can hand over whatever is left of that asset back to the public sector. So this is not in any way a policy of design to influence investment. This is in fact rewarding big private capital for not having invested. This is part of a long chain of things where every time you justify a policy as a policy which is designed to encourage investment. And when the private sector doesn't invest, you say we need to do more in order to encourage that private investment. So without making an investment, without creating new assets, you are going to be rewarded with a cornering a larger and larger share of whatever asset base exists. So public sector assets will also be handed over to you. But several, this is also part of other policy mix in which other parts of the assets, even private sector assets, which may not be with the big private capital, you create conditions where they can corner those assets also. So they basically eat up everything in the economy or larger and larger concentration in their hands. And this of course doesn't address the fundamental problem. The reason why they don't invest is they don't expect to be making money out of fresh investments. And they don't expect to be making money out of fresh investments because having cornered most of the economy in their own hands, they've left very little for anyone else to give rise to any kind of a demand. And if the state also starts handing over more and more assets to them and doesn't choose to spend or invest out of actually taxing them, then you're only furthering this process more and more. So it's like digging yourself into a deeper and deeper hole in the name of trying to get yourself out of a crisis. So I think that this is the way I would look at what this particular policy is when I place it in the context of what has been happening for more than a decade. And of course it has been accelerated with the current government. Its whole approach is also of that kind. And you're seeing this continuous process of no economic expansion, no expansion of opportunities, no asset creation, no employment creation by big private capital being rewarded by letting them take over. So you don't have to expand. You just take over what is there more and more. That's the process that is actually underway. And this asset monetization pipeline I see as an integral element of such a process. Thank you so much, Professor Shorojit Mojumdar for categorically stating that you see this entire chain of the sequence of events which has been going on for several years now as you say almost a decade but which the process which has got a certain amount which has been accelerated or intensified especially over the last post pandemic over the last year and a half or two. What we see is that the private sector is being according to you rewarded for reneging on its commitments to invest, to create jobs, to create assets. And if I may say though you haven't used this language, it's almost like a scorched earth policy. I mean you are destroying as soon as you see you don't have any other way forward. And I would like Sridhar to not only highlight or add to what has been already said by Professor Mojumdar, Professor Sridhar Shukto but to compare the changes that has happened. We know that during the Vajpayee government from 1998, almost six years till 2004, there was an active privatization policy to the government referred to call it disinvestment. They call it strategic sales. We know what happened in the case of Centaur hotel, various hotels, etc., etc. But even some of the individuals who were ardent proponents of that policy say, I'll give you one example, Minister Arun Shuri who's now a bitter critic of the present regime. And in fact he himself has said that maybe that's not the right policy we should have followed. And we know how he's been summoned to court, etc., etc., etc. for alleged acts of corruption in these privatization programs. But the short point is what really has changed? Even the Vajpayee government was ideologically pro-private sector. Very, very much. Are we now seeing after the Modi government comes to power, what is according to you the big changes in policies and programs that mark what has happened in the last year or a year and a half. Please unmute yourself before you speak. The most striking thing as a journalist, I was in Balco in 2001 when Balco was sold for a song for 550 crores. This was an entire township, not just a plant. It had a power plant to go with the aluminum plant. It was sold for a song 550 crores and it was a huge scandal. And there was an outcry and the government was forced to engage in some kind of damage limitation exercise although it went ahead. Subsequently, when they tried to sell BPCL, this is an anecdote I am relating from my own professional experience. BPCL privatization was opposed from the source from very close to the government actually gave me access to documents. I am just elaborating when you say BPCL, you are talking about Maharat, Petroleum Corporation Limited and also please continue. So there was Solisarabji who was then Solicitor General to the government, got in touch and said this is unconstitutional because it is a separate special act of parliament. Bharat Petroleum was created by a special act of parliament and this cannot be done. It cannot be sold like this and so there were objections within the government. You cannot imagine that under the Moji regime. That is a very striking thing. And the pace of privatization certainly stalled and they tried to privatize Nalco for instance. It met with stiff resistance and it was stopped. They tried to privatize parts of the Nehveli Lignite Corporation, it was stopped. So several of these suffered a setback in that time because the Vajpayee government did not enjoy that kind of majority in parliament as the Bodhi government now enjoys. And nor did it risk getting its own future by taking such a risk. That is a very striking difference between then and now. Here the scale of privatization is just humongous. It is just coming at you in a tidal wave, these waves of privatization. What they are embarking on is not bits and pieces of companies here and there. You just look at the companies that are now on the anvil within this next financial year. There is Shipping Corporation of India which is the leading company in India. It enjoys a significant market share. Then there is Concord which even when you are deciding to sell the company, it has a profit margin of something like 40%. You are just handing it on a platter to a private interest. And then there is the Rashtriya, Spatnikam, the Visakandar Patnam Steel plant and so on. So these are now there. But the most outrageous one of the lot is the privatization of LIC. I mean we will come to that a little later but this is in brief. This is the difference between now and then. The Vajpayee government could not have imagined privatizing LIC to just tell you how outrageous the whole notion is. LIC was not even a company when Nirmala Sitaraman announced the decision to privatize in her last budget. How can you privatize something that you don't even own? I just wanted to highlight the case of LIC to make this point that this is completely brazen, the scale and the enormity of the asset sale that is being planned. May I just interrupt you and play devil's advocate? I am playing devil's advocate to say that look what is the government's logic. The life insurance corporation has arguably it's one of the biggest repositories of money that at the end of the day belongs to the people of this country. This is long-term money, money that can be used for projects with long gestational life. What's wrong in having an initial public offering where you give a certain amount of money in a sense to individual, small private individuals as well as corporate bodies so what's wrong?  We know we had a big sort of a debate during the Vajpayee government or beginning foreign direct investment in insurance but this is the justification that's being given. For this you must appreciate that the LIC is sui generis in the world of finance. There is not a single insurer anywhere in the world which is comparable to the life insurance corporation. Let me tell you why. The government investment in LIC when it was set up the equity base was 5 crores. It has not put in a single pie over these more than 50 years. When the equity base was expanded in 2011 to 100 crores the entire money came from within the LIC. So it was just a book transfer. The point about LIC is this. The reason it was successful was because it had a certain character. It was perceived as a government company. It was backed by a sovereign guarantee which was never invoked in all these years. So there was an implicit backing of the government which assured people and motivated people to seek life insurance in a country of extreme poverty. Now if you say that it's only a marginal dilution of sale the point is that that is no longer legally compatible with the government guarantee because it is no longer a government undertaking in which the government holds the entire stake. So legally that is no longer the case. So when that happens you can't assume that this insurance industry will grow at the rate at which has been growing without LIC. I mean you could not have had insurance penetration of the kind we have seen and that is a it's a magnificent achievement. So what you are going to do is not so much not only destroy LIC in the process but you are going to you know subvert the progress of life insurance in India whereby people can have an affordable way of insuring themselves. And if you look at the ticket size of LIC policies they are very very much smaller than those of the private insurers who are there. The other important thing one very important characteristic of LIC is that 95% of the LIC by I mean as a matter of policy was rewarding its policy holders to the extent of 95% of all profits they were plowed back to the policy holders. Whereas in the private industry is demanding that it be 10% in fact the law has been amended to make it share 10% of its profits. Now that means it is no longer attractive to people to invest in LIC. In the name of causing a level playing field you are actually destroying this life insurance business in India. Yeah but enjoy. So would you like to add to anything that has already been said by Prof. Chirashtri Dasgupta and Surajit Mazumdar. Then we can sort of move on to another theme. No I just wanted to highlight a bit about this railway privatization business. You see some of the assets that are being are now on the block are assets that the railways have invested in in the last 10-15 years. Like for example the take the dedicated freight corridor. The dedicated freight corridor has been undertaken has been built it has already it is already you know functional in parts and you know it has been built with significant expenditure. Now when it is sold these revenues will be no longer be flowing into the railways coffers. So its capacity to invest in additional it is a huge backlog by the way of railway investment needs you know. There is a huge capacity constraint in the railways for which the government has not been investing adequately and particularly the Narendra Bodhi government has been worse in this respect. That is that is why I just wanted to highlight this thing about the state of the existing capacity. Same with the oil pipelines Indian oil and Gail and other companies have invested in the pipelines expecting revenues to come from them. Now if you just have it off and pass it off to somebody else Indian oil is going to get hurt Gail is going to get hurt because it's not going to see revenues coming from those projects. Alright I think you made very very important points Sridhar and essentially the point you're making is even the manner in which these assets are being sought to be leased monetized privatized you're just picking. You are literally Jerry picking those assets which are most profitable for the private sector and immiserizing and literally hollowing out the productive as the productive sections of the public sector. Professor Chirushree would you like to add anything and then I'll move to Professor Surajeev otherwise we can move on to another topic after this. I just wanted to point out a different aspect to this which is that if you look at India since 1991 or if you want to look at India since the 1950s when the whole process of planning and like a more regulated economy was introduced. The whenever there is talk of infrastructure whether it was government or private it's always been nodal infrastructure which is like this big projects etc. But the one thing that has never been looked at in India by any government seriously is what is called arterial infrastructure. That you connect like building of village roads of creating drinking water capacity etc. This kind of this is apart from electrification there has not been any kind of interest development of infrastructure that can be considered arterial as priority of any government. And even today when they are talking about whether it is by the reason that we don't have this is partly to do with or wholly to do with what we've been discussing before.  And hence there is nothing that is left which can then be used to really develop arterial infrastructure as well as social infrastructure. So because we have been talking about the last two, three years. If you see that I don't know I think we will discuss MSMEs separately so I'm not going. We will discuss it. So but if you look at one of the things that is in the last two years is clear is the total collapse of health infrastructure which is the most privatized one of the most privatized social infrastructure in India. And not the bid is so this thing about handing over everything to private capital is not merely limited to large physical infrastructure but also to social arterial social infrastructure through the new economic policy for example in the case of education. And the simply allowing the collapse of the public health infrastructure by underfunding and under investment in the last so many years. I just wanted to add this. I think you highlighted a very, very important point. These figures are known. We've discussed them. I mean the pathetic public investments in healthcare. I mean it's so obvious today especially in the COVID post COVID and the way in which the whole education are investments in education. And it's also been very, very, I mean these are all very well known and and then why are people surprised that hello, one day she seems to be doing better than us. It's a great hurt to our quote unquote national ego. Surajit would you like to add to any of the points and maybe we can from here move on to a related theme and this is the this whole dependence on not just privatization but foreign direct investment. I mean I just before I come to come to this point, say coal mining, just one example. June 2020 peak COVID suddenly India opens the coal mining sector to commercial operations by private industry coal extracted for mines identified for auction under the process can now be freely utilized, not just for private captive consumption, but for general sale or even export. And before this, I mean all those end use restrictions have been removed. Now when you look at the other way I mean, and in coal it's also there foreign investments in 2020. India changes foreign direct investment regulations to allow investments of up to 74% in defense in the defense equipment manufacturing such sector under the automatic route. This was earlier 49%. This is an important decision for a sector that is even today struggling to attract investment and then we've already talked about insurance and the life insurance policy. But you've done exactly the same thing. You passed an insurance amendment bill to permit 74% FDI insurance companies against the existing cap of 49%. And all of this is ostensibly in the name of the ease of doing business. Professor Shorujit Malindar your views. You'll have to unmute. Yes, please. Yeah, even more than the ease of doing business. The sharp contradiction that one can see is between these and the idea of Atman Irvar Bharat. That only in India could we think of calling a policy of promoting Atman Irvar Bharat where you increase the FDI limits to 74% in defense and insurance. How that can be reconciled with the idea of Atman Irvar Bharat is something that beats me. But I think I'd like to link this to the question that you posed to Sridhar about what's the difference between now and earlier. And that difference is that I think the transition that has happened. Is that the idea of government and state economic policy supporting private capital in a process of economic expansion has been as that process has come on none exhausted itself. You have increasingly a transition to a scenario where the government is expected to support private capital in cornering more and more of the assets of the economy instead of creating assets in a process of expansion. And this transition, this is an economic transition that has happened also necessitates a far more authoritarian context. Because of course the contradictions between this process and almost all other segments of the of society become much sharper. And what the post 2014 regime has offered is that far more authoritarian kind of regime which can think at least that it can push all of these through. That it does not always succeed is something that is proved by the fact that the farm laws have had to be repealed by even this regime. But the notion or the idea that this regime can actually push it through has is the reason why even big capital has gravitated and stuck with this regime even though you can see several signs that the economy is in quite a state of shambles. So I think that's the transition that has happened and therefore on the one hand you get a bigger push towards this privatization and acquisition. And there's an added element to that which is this that when you are interested in expansion of production etc. and all of that. You want certain benefits which certain kinds of supports to come from the state. So good infrastructure development by the state is something that can also be helpful to private investment when it is interested in investing in expansion. But as the scope for that shrinks as you move more and more towards looking to acquire assets. Almost every sector becomes something that where using that sector to I mean using it to acquire assets or using it to earn profits becomes far more important than the services that it may offer to private capital investing in other sectors. This is true of education. There's a little interest in education except as a profit making sector because frankly speaking the kind of expansion that is taking place the number of people that you actually require. And the kind of training that they require is so limited that that consideration as to what's going to happen to the quality of the education system is of little concern to big private capital. Even though it might be wanting to employ the products of the higher education sector. So across different sectors there is little concern about what's going to happen to the quality of education. What is more important is how much profit can be made out of that particular sector and the same applies to most of these other sectors and infrastructure sectors. So you are having a transition from a situation where public sector presence in certain sectors was in a sense supportive of private investment or expansion in other sectors to one in which whatever areas are under still under the public sector simply become areas on which you want to poach more and more because you no longer expect that other kind of role to be played by that sector. Okay, thank you so much Professor Surajit Mojumdar. Let me come once again to Sridhar. Sridhar, this is linked, it got into my head because I'm going to talk about production linked incentive. Yes, I mean it's linked to what Professor Surajit Mojumdar says. And they've been introduced across several key sectors ostensibly to create what are called manufacturing champions. National manufacturing champions like we have champions in juggling and wrestling and so on and so forth. And this is supposed to be creating employment opportunities for our youth. We know how young a country India is, it's a separate matter that India will soon overtake China in terms of the number of people, the population, the total population but we know that about half the population of India, roughly half the population is below the age of 26 or 27 or whatever. So all this has been done in the name of creating jobs for the youth. And let me quote what Finance Minister Nirmala Sitaraman has said. She has gone on record saying, and this is all linked to the Atmanir Bharat scheme to make India self-reliant, self-suppression. And she said, Ms. Sitaraman says, the objective is to make India a bigger and more important part of the global economy by pursuing policies that are efficient, competitive and resilient. What do these words mean, your views and please unmute yourselves. This PLI scheme is very different from similar exercises undertaken in several of the East Asian countries and elsewhere in the world, in the sense that the state provides an ecosystem for manufacturing capability. Instead, this PLI is basically a set of bunch of incentives meant to make it profitable and it is very unlikely that these will have a long-lasting effect. I mean, especially once those incentives are no longer viable or not available. So that is one. Secondly, this kind of contracting out, farming out of activities to private industry based on incentives is very likely to lead to very perverse incentives for industry. For example, there is not far from Bangalore, there was this Apple's manufacturing facility in which wages were not paid for months together to employees. Many of them women and there was a big protest. Yes, and there was a massive retaliation from the workers. They smashed up the working place. I mean, it was completely outrageous what this Apple's contractor was doing. Now the PLI is something like this in the sense that you are incentivizing, you are all you are doing is you are providing a bunch of incentives to these companies to make something in whatever these are called champions and so on. And it is very unlikely that they will emerge competitive in the long run anyway because an ecosystem for this doesn't exist. I mean, I just have a, I mean, I just talk about the state of the vaccine capacity, for instance, to make this point. You know, our complete dependence on two manufacturers for our vaccines without developing an ecosystem. There are many private small biotech companies which have capabilities to produce vaccines, but they don't have the scale. Many of them were incubated by the Department of Biotechnology years ago. And so, I mean, it would make much better sense to for the state to initiate and state to take charge of these these activities. You know, you provide an ecosystem, you set the discipline, you make sure that private capital delivers, you provide an enabling framework. That's it. You don't allow yourself, it's like the tail wagging the dog. That's what is happening in this PLA. Okay. Would you, would you like to add anything to what Sridhar has said, Professor Chiro Shri, Zajgupto. It's essentially this whole idea that we are creating these national champions like Javelin champions and badminton champions that they're going to create jobs. But what we are actually seeing is far from making India atman nidabhar. The reverse is happening, far from creating jobs at a very, very rapid space which India needs given its young population. We don't see adequate investments and therefore not seeing adequate job creation. So your views on this whole PLI scheme, the production linked incentive scheme, which is supposed to be one of the big, what should I say, a major scheme which the government is starting. Yes. Well, first of all, if you look at what is the allocation for this scheme, which is a measly 1.97 lakh crores out of which 50 to 57,000 crores are promised to the automobile sector alone. So the rest nine sectors which have been added later will hardly get any substantive kind of support. So there are these grand announcements, but they're not backed up by even the minimum amount of investment that is needed to make these at least functional and sustainable. And that brings me to the question that I was referring to earlier, that if you just don't look at PLI in itself, but for example, look at what has happened to the MSME sector as a whole, which is one of the prime sort of supposed targets of this scheme. What you find is that first demonetization and then GSD had already destroyed a large number of firms in this sector. There were firms which had gone bust. There were stories of suicide of entrepreneurs, if you remember a few years ago, and then subsequently COVID really created havoc. I'm briefly interrupting you Chirushri, I don't know what these statistics really mean, but according to the data released by the NCRB, the National Crimes Record Bureau, more businessmen are supposed to have committed suicide than farmers. I'm just putting out what has come in the media. I mean, I don't have the veracity of that because one of the problems is that women farmers suicide is not recorded as farmers suicide. It's recorded as women suicide, so that could kind of treat the people, but it's true that businessmen have committed suicide and these are all small operators.  With one exception, perhaps the person from Kerala, the Café Coffee Day person. Oh, yeah, true. But then he's not as big as the kind of scale that we see with the top 20 that we are talking about and especially the top 20. The oligarchs. So in the situation, if you now see that there's several things that have been put out. So there was the emergency credit guarantee loan screen, which was also put out, which once again, if you see the amount, initially it was three lakh crores and then it was increased to 4.5 lakh crores. Out of which still date according to the minister in the current session of parliament, only 2.82 crores have been sanctioned and there is no data about the actual disbursement. So sanction is 50%. So disbursement will be even less, maybe 25% is my guess. It's a reasonable guess. So under these circumstances that apart from the fact that there is a lot of pomp and sort of show about these grand announcements, the actual working of these schemes on the ground apart from what is being announced. So even if we take that component of Atman-Irbar Bharat and not look at the larger implications which others have talked about, Surajit has put it very succinctly and so has Shridhar. But even if we look at these components, which were supposed to, it's just not enough. And if you don't put in enough as Shridhar has been saying that just if you look at the kind of government infrastructure support and the kind of policies that was followed by East Asia. And that was also by authoritarian governments. If we want to put that parallel here, but the main difference I think is that the state there could control the capitalist class while in the case of India it is the capitalist class which is controlling the state. And the nexus is strengthened thanks to the legacy of former finance minister who is now no longer with us, Mr. Arun Jaitley, the electoral bond scheme. Absolutely. So the pro quo and the nexus between big business and politics, I mean what we too certainly know that almost the lion's share as they would say, or the bulk of the money that's coming through these non-transparent electoral bonds have gone to the ruling Bharati Janta party. Absolutely. So that itself, so in that sense what we have here is a kind of a sort of almost what is called a, you know, like a some kind of a swap to the MSMEs to keep them from because there is a lot of disconcerting developments within the MSME sector, which is actually potentially also dangerous for the BJP in terms of its political base. But at the same time, so there are certain shops being announced periodically in the name of Atman Irwal Bharat, but together in substantive terms it does not add up too much. But why they managed to still keep going and doing this is primarily for two reasons. Of course the farmer struggle has shown that this strategy can also fail. But one of the things is that this this aura of authoritarianism that you can push through anything is something that has been sort of trumpeted by the media in building that kind of an image. And the second is that the thorough communalization of the polity and to that extent a deep politicization of the economic question as if the economic question is the realm of experts with the great leader being the best expert on this. And then the, and others need not bother about it, they just need to bother about whether Hindu Khatremahai or not. This kind of a divisive thing which kind of puts a veil over the real questions, the real structural questions in terms of the daily lives of the people of livelihood, of employment, the things that we are talking about. So in that sense Atman Irwal Bharat is that big veil that has been put over all these questions. Okay, you raised several points and I'm going to add to one or two points you made and asked Professor Surajit Majumdar to react on a day when the Supreme Court tells the advocate for the Uttar Pradesh government who claimed that pollution in this country and the capital is because of the fumes coming across the border from Pakistan, which prompted the Chief Justice of India to say we can't do anything about the industries in Pakistan. But on a more substantive note Surajit, there are several points that Chirashree has raised. Now this broadening on the definition of what is a micro enterprise, what is a small enterprise, what is a medium enterprise is also supposed to be a part of this whole ease of doing business policy of the government. But there are two aspects, much of the so called, much of the so called what you call it policies and decisions of the government has been essentially aimed at providing loan credit, including credit to medium and small and medium enterprises, micro small and medium enterprises. And essentially you have increased the threshold that which people can take loans, credit guarantee schemes for subordinate debt and essentially the scheme provides for 20,000 crore worth of subordinate debt for roughly 200,000, 2 lakh micro small and medium enterprises, which the assets are stressed assets or they are non performing assets, essentially companies which are sick. Now bank is supposed to provide the subordinate debt to promoters of such small enterprises equal to 15% of the promoters existing stake and subject to a minimum of 75 lakh rupees and more additional funding. They are announcing 3 lakh crore loan relief. Now the point that I'm going to ask you that these programs then MSCs will not have to provide guarantee collateral to avail of these benefits, will it really help? And why and why is it so important because everybody knows that it is this segment of the economy, this sector of the economy, micro enterprises, small enterprises, medium enterprises that have been creating jobs. And they are this sector of the economy has been very, very badly hit by the recession post COVID. Please your views. Well, I think as she was saying that there is a kind of trumpeting of what is being done when it will not actually backed up by any substantive commitments in terms of expenditure. The, I think if you look at all this set of policies which are about promoting credit or credit waiver or making it easier to grace access to credit production linked incentive schemes, etc. These all of these are apart from the fact that they are not in terms of significant in terms of what change they bring about at the ground level are also ways and means of trying to show that you are doing something when you are not actually willing to do what is the real requirement or where the real problem lies. So you are supposedly promoting a policy in which you are trying to help enterprises which are unable to help enterprises expand production, expand employment, improve their financial health without asking the question why are they first in that situation. Now, at the moment, it seems that it is COVID and all the associated things that have happened with it that have resulted in that particular problem. But firstly, this problem predates COVID. It predates even demonetization, which is that you simply do not have adequate demand available within the economy or what export markets are able to offer you where and if and when you can be competitive enough demand to sustain this expanding an expansion of production. When in that situation, you further aggravated the problem with measures like demonetization, GST and then in the effect of COVID also exaggerated by the inept way in which it was handled with the result of which was a severe economic contraction combined with a disaster as far as controlling the spread of the infection itself was concerned. Now, if all of this has resulted in devastating a demand situation that was already adverse or poor, then unless you address that fundamental problem, how can you address this issue? Now that addressing that fundamental problem requires at the minimum of willingness to expand expenditure by the state. But what are we seeing? We are seeing the exact opposite. So, you do not expand expenditure. If at all you do something, you give concessions on the tax size and that becomes a protection then because you are going to say lose some revenue, that becomes a protection to further cut down expenditure. So, no attempt at even increasing expenditure which is the minimum requirement, not a sufficient condition for addressing the problem of at the demand level that exists in the Indian economy. And you are not willing to even increase expenditure in ways which will enable even firms to be competitive in a global market which is in any case not in a very healthy situation at the moment. The experience we have of the last 10 years is, I mean fundamentally what was the difference between the idea of making India and all of this that is happening now? Make in India was what? We will make, we have very cheap labor. It is an attractive place to produce therefore and therefore we will make it easier to do business here less costly to set up a business and to produce and for the not only the Indian market, for the world market. What is the effect that it had? What is the result that we see? We see no increase in exports for 10 years. We see no investment increase for 10 years and we see a manufacturing sector in India which is progressively shrinking relative to the entire economy. That is the phenomena for the last 10 years and so why is it that you are actually seeing this long history? You will not look at that. You will not see the evidence that stares you in the face that this attempt at trying to push, manufacturing to push exports to push growth by simply addressing questions of credit and incentives on the supply side is simply not working. You have this mountain of evidence in front of you but if you do not wish to see it and respond according to what that evidence tells you then this is the scenario that you are going to be in. I describe it as a situation in which India's policy makers have decided that we are going to keep digging ourselves into a deeper and deeper and deeper hole in the vain hope that at some point of time will strike gold. We are digging, we do not find gold, we dig further, we still do not find gold, we dig even further and we still do not find gold and we are going on doing it in the hope that at some point of time will strike gold. And if in between there are other things that happen where rainwater comes in, landslides happen, something like COVID effects comes, if we sink in that if we can raise our head a little we say we have recovered. Forgetting the fact that we are sinking into a deeper and deeper hole. That's the reality of, so all the talk will be about we are doing this and you can get anything can be described in great detail and you can on paper draw a causal link between that and result. But has anyone made an assessment of several such schemes and policies that have been said will produce this result? Where is the result? Where is the result? At the end of the day you neither get investment, you neither get industrial development, you have one decade of manufacturing growth, output stagnation. There is only one previous decade in the history of independent India where you add similar story and that is referred to as the stagnation decade after 1965. No other period in India's post independence history has seen such a poor industrial growth performance as the last 10 years. You don't want to see the evidence, you want to fiddle with GDP and somehow find a story that no, things are all well. So all the evidence that is there, investment as a proportion of GDP declining, trade as a proportion of GDP declining, construction boom over, industrial growth stagnating, employment as a proportion of the population declining. You have evidence that large sections of the population either don't have work and what they earn from that work gives them very little. Self-employed persons 10 to 12,000 rupees a month, agricultural households 10,000 rupees a month from all sources, casual labor less than 300 rupees a day when they get any work. Regular employment also not more than 16,000 of that also many of us who are in formal sector employment at higher salary push that level up. You look at the large majority, industrial workers 14,000 rupees a month average monthly income salary and this is the state of and you see the wages stagnating for a long period of time.  If you are not going to do and you're in addition having additional change that people were poor earlier. But when they were largely rooted in the rural agricultural economy. Apart from natural factors there was some degree of stability or certainty with their lives. That is also disappearing. So in addition to income stagnation is increasing economic uncertainty that large majority face with that as the nature of the Indian market. Who will so our big capitalists are very smart they know they're not going to make money by investing in creating new productive capacities. So they're not interested in that and they voted with their money about what is the state of the Indian economy. Don't say go by what statements they make in the association statements and all of that what have they said with their money. Where have they put in money to expand productive and employment capacity of the economy in 10 years. They haven't done that and they won't still do it. All schemes etc to the extent that it benefits them it will help them to increase the profit out of whatever existing activity they do.  There's no scope for them to make a higher return. And if you do nothing to expand that market to initiate any process of expansion and you let let that fragile household economy of majority of Indians become get battered and battered and battered with everything. Demaritization, GST, COVID, lockdown and you do nothing to put it on a share or footing then this is going to be the result. So it is in a sense creating economic devastation on which then the big corporate cultures can feed and take over larger and larger part of the economy. That's the only way I can describe it. I mean those analogies have been very very stark. In fact you know digging and digging and digging and digging deeper and deeper and deeper and deeper in the hope you find your oil or you find your gold and hoping that something will come out of the blue. You know you have highlighted and flagged and reiterated an issue which all of you have been highlighting over the discussion, the issue of demand and the demand and we haven't really talked about inflation. But how much of that inflation has been really cost push and how much of the demand pool and we can has been argued in more than one place. But the inflation that we are seeing is really largely cost push inflation and much of it or a fair amount of it because of petroleum products. And then when the ruling party does badly in the elections or anticipates a bad outcome in the forthcoming assembly elections suddenly petrol prices and diesel prices come down and the farm laws are abrogated. And it's interesting what you said Surajit about the mountain of evidence which is being ignored. And I am reminded of if I'm not mistaken it's a biblical statement but I'm not sure I'll be standing corrected. There are none so blind as those who will not see and let me move on in a sense to the last theme of what we are discussing. You know link to this whole ease of doing business is the big corporate tax cuts that went before COVID by Finance Minister Nirmala Sita Raman and I quote her here. She says measures have been undertaken to promote ease of doing business with rational tax systems simple and clear laws reducing the compliance burden. And then we know a recent initiative of the government to scrap the retrospective tax law which would help resolve tax and according to the Government of India and the Finance Minister it will boost investor confidence. We know there was a background to this particular discussion and we know about the Vodafone case and the Ken Energy case and India. In international tribunals and courts India's position not being what should I say vindicated by courts of law and outside India. So I'm here asking all we have a few questions which have been one question I know which has been also raised so let me also put that question. And this is also linked to this ideological debate that or the government's ideology which is being given more sort of emphasis than anything else. And that question is are there any examples of firms or enterprises where we've seen collective ownership doing well surviving in India. So I'm raising this question this question has been I mean there have been a lot of people on the chat box who praised your views and have appreciated the points you made. And so I mean people have sort of argued on many of these points. So I'd like you at this juncture we have still about 20 minutes so it would be good if all three of you sort of maybe I'll reverse the order. I'll start with you Surajit go to Chirashree and then to Sridhar some of the points I mentioned and this whole and let these be also your closing remarks on this discussion that we've had. Okay now as far as the question of collective ownership is concerned I would say that in any case I mean successful I think Sridhar spoke about LIC.  But of course in general even when we talk about weak capital there are of course business families who control these vast empires but it's not their money that is invested in it largely belongs to us. So there are also in a sense kind of collectively owned but I'll leave it to others to speak more about it because I want to just emphasize one point which sums up some of the things that we were talking about which is that if you look at this current financial year. The current financial year we have data now up to October. If you look at the central government's expenditure. How that has changed compared to not only last year but even 2019-20 the same period of the year which is April to October. Then you'll find that compared to last year the actual expenditure is only about 9 and a little less than 10% more than last year and it is almost the same level higher than 2019-20. So only a 10% increase in the total expenditure of the central government compared to 2019-20 even though the level of inflation in this period the increase in prices has been higher than 10%. So in real terms the government of India Union government has spent less in this year in supposedly attempting to recover from COVID then it's spent in 2019-20 when it was recovering. But you look at the other side of the equation which is what has happened to central taxes. So the center share in central taxes compared to 2019-20 is more than 50% higher. So it is not that they because the revenues have been lower they are spending less. They are deliberately choosing to spend less and reduce the deficit rather than to reduce it. There is also a story about the way more than 50% increase in central share in taxes has happened because this goes along with a minus 16% or a 16% reduction in the share of states.  And whereas the additional taxes come from a significant part of course comes from excise duties which are coming from basically oil and petroleum and oil products. So petrol and diesel have been the main source of a major source of the increase in taxes. But what seems to be interesting I don't know whether this will last till the end of the year or not. But it seems to be that even corporate taxes and income taxes personal income taxes. Their increase is much higher compared to any change in the nominal GDPO. Now this can only happen because there have been no upward revision in the rates and certainly in this period no massive efforts to get more tax compliance or anything. In the midst of all this chaos that the economy has been facing. Nothing like that has happened. So it can only mean that the share in total income of those who pay corporate income tax and that's a relatively small number as Chirushri earlier indicated. And that ties up with what we know from the accounts that have been placed that without a significant increase any change in significant increase in sales even profits have increased by basically cutting down. On various costs which include of course wage costs. So you have the sections which pay corporate tax companies which pay corporate tax and sections of the population which account for the bulk of the income tax which are the relatively higher income groups in India. They are sharing income actually having increased. So you have an increase in inequality that's what this is indicating you have an increase in inequality. That is further accentuated by living these higher taxes on petrol and diesel which are taxes that everyone has to eventually pay whether they directly buy petrol or diesel or not. It's a universal tax. So you exaggerate the inequality that is happening by living this highly regressive kind of tax. That's the wrong tax rate that they increased and then you decide that you will use the revenues that you get from both these sources to cut down your fiscal deficit rather than to step up expenditure. Now what else other than a mindless commitment a mindless commitment to so-called fiscal conservatism can explain why this is happening when we are supposedly trying to recover from the battering that the economy has received as a result of COVID. So thank you so much for those remarks concluding remarks and they are very, very important and I'm extremely happy that you flagged these issues with the articulation that you have. Professor Chirashree Dasgupta, there's surely this flagged this whole issue of an already unequal extremely unequal society becoming even more unequal and arguably India is one of the most unequal countries in the world. One of the most, I mean I'm not sure of the data whether it be Brazil, whether it be South Africa, whether it be the United States, India is arguably today one of the most, one of the countries where inequalities in income and wealth have really widened and deepen. We were already a very unequal society and we've become even more so. The second point that Surajit has flagged is this inequality one of the reasons that has directly and indirectly contributed to this inequality is the growing dependence on indirect taxes. In particular indirect taxes on petrol and diesel, which by their very nature are regressive which is the opposite of progressive everybody has to pay the same price, the same taxes. The whole economy, the political economy of being more centralized, less federal, squeezing the states and all of these are resulting in the progressive taxes, the direct taxes as a share of total tax collections has been coming down. So let's have your concluding remarks and then I'm going to move to Srinath. Okay, agreeing with all that Surajit has said, I would just like to point to two or three issues, which would also address the additional questions that have come in. So let us start with some data, which is that if you look at the last few years, one of the major changes since the 1990s till date is that earlier out of total value worth 65% in 1989 used to go for wages. And 35% of the total value created in the economy went to the surplus out of which profits are one part after deduction of rent and interest. Today, what we have is just the opposite 35% to 40% is wages 60 to 65% is the surplus share in the last three, four years. The second and most important data, which I often kind of reiterate is that if in the organized manufacturing sector, as per the annual survey of industries, for every 10 rupees of value that is created in the manufacturing sector, just 18 paisa goes to labor. So labor is virtually free in India. So it is in this situation that we are talking about inequality that to a point where the redistribution from labor to capital has intensified in such a significant way in the last three decades. And especially in the last five years that the, the average level of whatever security people had has gone down to an extent where most labor, 93% of Indian labor is in a state of precariousness. Now, in this situation, by the Ishram registration, or this new labor code, which promises some minimum degree of social security. If you look at the details and kind of decode the code, what you find is that it actually disenfranchises people who already had some amount of social security and promises barely anything, barely the minimum. For others, and given the experience of past schemes like the energy etc. We know that defunding and reducing like cuts in the funding of social expenditure has been the norm for this last five years. Okay, it has been there before too, but there were periods of expansion while under this government every year the social sector has seen cuts in real terms. So under the circumstances, we even expect that this Ishram registration will actually mean something concrete in terms of addressing the precariousness of people's lives is absolutely misplaced. And yes, of course, this kind of ties in with the larger story that we've been trying to construct through this session, which is about a significant redistribution of resources from the poor to the rich from labor to capital. And basically, that is the fundamental reason for the intensification of inequality in the recent years. And hence, and this has obviously led, this is the fundamental reason that inequality itself is the fundamental reason for the contraction of demand. And hence, what is essentially a demand side problem is just being looked at from the supply side, the digging holes is like absolutely the metaphor that explains it. The last point that I want to make in terms of that question about firms enterprises with collective ownership. Well, there are a few, but those are not in the corporate sector. And I will give you only one example that of the Kudumbashree in Kerala, which has sustained over the last two decades, a little more than two decades and grown and completely run by women on the model of self health groups, but with substantive support from the state government. And so that I think is an example that we should look into to say to understand what an alternative model could look like. Yeah, I'll stop here. Thank you. Thank you so much, Professor Chirushree Dasgupta. And we don't have time to discuss the details for what the government is attempting to do now and getting to the cooperative sector as well, you know, we've seen particular cooperative organizations that have done well, including the National Dairy Development Board, what the government has in mind now we don't know. We left the last words from Sridhar. Sridhar in about five or six minutes, if you can wrap up your discussion, several points that we made by Chirushree. And how do you see now the way forward?  I want to pick a couple of things which Surajit was talking about and about the demand constraint of the Indian economy as the underlying basis for all our problems. Added to this is the fact is the is the nature of our small industry, small industrial base, which has been essentially parasiting the relationship between small and big. You go to, you go to any industrial cluster, you go to, I mean, I'm very, very close to Hosur, where there is a, it's a perfect microcosm of all this, all kinds of units. You know, there is Ashok Leiland and there are several large units, but there's a whole ecosystem there. Now the entire relationship has been parasitic and there has been never, these larger companies have never been paying their dues to the smaller units in crime and there are a perpetual cash flow problem. Now, many of these small units are, you know, they have their idiosyncrasies and because of that they bring some innovation to the practice in industry. And so they are, they bring a lot of value to industrial production, but the relationship between large and small is essentially parasiting. Now, I want to tie this to the question of the credit-based and the entire focus of the since COVID last year has been the emphasis on credit-based or bank-based maneuvering.  It's not happening. The problem with small industries are facing, the problem is that they are facing an insolvency crisis. They're not facing a debt crisis. They are facing an insolvency crisis where they are submerged, they're already submerged in debt and their viability is in question. The interest rate being a little lower is makes no difference to them at all. And we have continued on this dim-witted approach of trying to lower interest rates and get activity going. It's not happening. Now, if you look back since 2016, I would put the COVID crisis as part of a continuum which started with demonetization, proceeded with GST and then with COVID. It's a continuum in which the small enterprises have been really badly hammered and this crisis is loaded against them. And so I see and this sets the ground for further concentration of capital because when the small GST did the same, demonetization did the same and the COVID lockdown had the same impact. And so there has been a prolonged crisis for the small industries. Now, in which debt is not going to, credit, focus on credit is not going to make an aorta of difference to these companies. And that is precisely the situation in which cooperatives are discouraged. No cooperative is going to get bank funding. It does not have institutional support from the government. To wrap it up, I think what has been happening under the Narendra Modi government is basically the pursuit of a nakedly Malthusian agenda which promotes this drive towards concentration. Thank you so much. Thank you very, very much, Sridhar. Thank you very much, Chirushree. Thank you very, very much, Surajit. This has been a very, very revealing, enlightening discussion and it has highlighted what the government doesn't want you to know. The questions that were asked have been answered. A credit-based hope for recovery will not work. You're looking for supply-side solutions to a demand-side problem which will not work. And then, I mean, this whole issue of unorganized workers, you have an Ishtam portal and Ishtam registration, but you have gone to the extent of actually the kind of internal migration that we saw in the months of March, from the night of the 24th of March, 2020 for the next three months and a little longer, was in my opinion, unprecedented, not only in this country, in the history of the subcontinent, but perhaps in the world. And you have here a government, none other than the Solicitor General of India quoting the Home Secretary of India, telling the Chief Justice of India there's not a single migrant worker on the highways. I mean, in my opinion, there couldn't have been a bigger lie. There have been many, many lies and as far as the government's vision of social security, the less said, the better. So thank you so much NewsClick. Thank you so much, Center for Financial Accountability. I thank all those who've been hearing, listening, watching this program. This will be available on YouTube, on the NewsClick website, on the NewsClick YouTube channel as well as that of the Center for Financial Accountability. And so I thank all of you and I'm just giving you a little heads up that we're going to have more such discussions. We've had two already. And now on the 6th of December and on the 10th of December, we're having two more discussions, which will deal with the same themes that we have. So once again, it has been my honor, my privilege to moderate this panel discussion. Thank you all very much. Exactly 5pm. Keep well. Have a good evening. Thank you. Thank you. Thank you.