Thursday, 20 September 2012

Crony Capitalism and it's paid office bearers

So we have a Bharat bandh supported by almost all opposition parties. Without getting into the merits or demerits of the bandh itself, a govt. which is presiding over one of the most corrupt period of India's political history has no right to tell ordinary citizens, already reeling under the effects of double digit inflation, to tighten its belt even further.
If fiscal deficit is to be controlled one way is also to improve revenues, which is precisely what the 2G, Coal allocation etc. were supposed to do through correct price determination through competitive auctions. Whereas they were allotted to all near and dear ones of the ruling party and its cronies (some say even in the main stream media) and therefore the revenue accrued is obviously depressed.

Now if the govt.'s argument is that the loss is notional and therefore not actual loss, then let us citizens tell the honourable economics Phd. PM that even the subsidies or losses to oil marketing companies are notional. Notional because they are compared to the international crude price and not actual input costs. You can't have two sets of rules. Stick to one set of accounting - either aggressive or conservative. That is Accounting 101 Mr. PhD.

Finally let us look at the paid office bearers of the crony capitalists. The CII says Opposition's bandh costs people over $2 billion loss
Now see what they were saying during the scams - 
They have the gall to ask the govt. to keep these allocations achieved through fraudulent means intact. So essentially if a thief takes over your property he shouldn't be allowed to vacate cause he had bribed a local official to change the rules.

2. After the 2G scam, the CII issued a statement that high spectrum prices will hurt national interest and inclusive growth. Link here. The byline is that it will hurt the crony capitalist's interest.

And that is possibly the biggest challenge with doing business in India. The whole system is controlled by a select few who deliberately want a non-transparent system so that their monopolies remain intact.

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