Funds aplenty for political defections, but none to fight COVID-19

Why is it that government goes through existential angst when it comes to spending on healthcare or education?

Shah and Modi
The pandemic has ensured that the struggle for an economic recovery is all but lost | PTI File

When it comes to building statues, buying big ticket defence equipment or, for that matter, spending money on legislators to defect, there is never a shortage of funds. But if a fraction of that money has to be spent on healthcare or education, each paise is carefully calibrated, complex accounting is done and the government throws up its hands.

World Bank is needed to donate $1 billion to the Indian government, employees of governments are told they may have to face salary cuts and appeals are made to people at large to be generous and hand over a part of their earnings.

In fact, Prime Minister Narendra Modi told fellow BJP workers on Monday that they might even have to hand in their gold jewellery if need be. Meanwhile, his government cut two years of money worth ₹10 crore meant for members of parliament to use for the development of their constituencies.

“During wars, women used to give their jewellery; even the poor used to give their meagre savings. Think of this situation as a war. It needs the same spirit of donation,” Modi was quoted as saying by Hindustan Times.


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On the contrary, let’s see what the world’s power-house countries have done. The United States is setting aside $1 trillion to help the country’s small businesses and taxpayers. Other countries like Italy, United Kingdom, France, Spain and China have all announced similar packages including cuts on tax rates, schemes to protect the employed, support for loan relief and higher social  security payments. In short, those governments are stepping in with funds to help their people, not the other way round.

While, per se, there is nothing wrong in a government asking for people’s involvement during a crisis like the ongoing coronavirus pandemic, the question that arises now is why the dispensation remembers the common person only when it comes to extracting money out of them.

Not just that, why is it that the government goes through existential angst when it comes to spending on healthcare or education? India’s spending on education is a miniscule 3 per cent of its GDP while on health it is a measly 1.28 per cent.  In comparison, Europe and the US spend around 8 per cent on healthcare.

On one hand, India would like to be known as a superpower and the political leadership struts around as if the world is eating out of its hands. Yes, the world occasionally does, like now when several countries including the US are asking for anti-malarial drug hydroxychloroquine that India manufactures in plenty. But, as the saying goes, one swallow does not make a spring.

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The simple point is that it is always the salaried class that is targeted — for pay cuts, reduction in pensions and cut in interest rates of various savings instruments — all in the name of a national calamity; as if the government has no money in its kitty.

At the same time, you have vacuous projects like the ₹20,000 crore plan to rebuild New Delhi’s power centre — the environs of the Rajpath, Raisina Hill and Parliament House. Not that there is any immediate threat to this site that has seen so much of history. It is being done seemingly to satisfy the whims of those in power even if it does not entail immediate expenditure. No other conclusion is possible as the government itself is confessing it is short of funds to combat the Covid-19 scourge and its possible economic fallout.

And, the controversial ₹3,000 crore spent on erecting Sardar Patel’s statue (Statue of Unity); that money could have easily done wonders if it had been used diligently in some areas of  India’s healthcare.

If the salaried classes are the sheep that have no choice but to nod their heads to any hare-brained schemes of the government, the ones that slip away are those in the private sector whose earnings the government cannot track.

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In 2016, the Modi government thrust demonetisation on an unsuspecting population to apparently fight the existence of rampant black money in India’s financial system. Over three years since, there is no evidence the government succeeded in its aim to quash black money.

On the contrary, the note ban ruined the economy that has continued its way downhill. Now, the coronavirus pandemic has ensured that the struggle to recover is all but lost.

But, strangely, there has been no shortage of money in circulation. Take the innumerable elections since demonetisation. Was there ever any evidence of a political party, particularly the ruling BJP, spending less or individual candidates advocating minimal expenditure as funds were in short supply? Of course not.

In election after election, money flowed freely. To top it, in various states like Karnataka and now Madhya Pradesh, the results have been subverted using money power. People vote one party to power, and in time the opposition takes over — on every occasion it is the BJP that gains. And, the money factor is thinly-disguised with allegations of payoffs ranging from ₹10 crore to ₹50 crore for each legislator.

What this indicates is the existence of a parallel economy and black money supply that continues to flourish unabated, notwithstanding demonetisation.

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Yes, there have been raids on income tax defaulters, money hoarders and those in power who exhibit “assets disproportionate to their known sources of income”. Unfortunately, it is well documented that the exercise is not even-handed. Those in the opposition, dissenters and anti-establishment figures are the ones that have been targeted. So, the aim is really not against black money, but witch-hunting in the realm of petty politics.

India, along with rest of the world, is facing a dire situation with no idea about which way the Covid-19 pandemic is going. The government may claim it is on its way to becoming a $5 trillion economy in the next five years, but that is sounding increasingly hollow and pompous, considering its financial inadequacy at the moment.

Funds are needed to prop up India’s dilapidated healthcare structure, and more urgently, personal protection equipment (PPE) is required, besides masks, gloves, sanitisers and ventilators in their millions. And for this unexpected budget-busting requirement, the government says it has little money.

If this indeed is the case, as it seems to be, then there is something seriously wrong with the way India is run — where a government that projects itself to be adept in so many extraneous ways does not have the wherewithal to face an emergency with confidence aided by self-sustaining deep pockets.