Mumbai, December 19, 2011 : On Sunday December 18, 2011 cabinet clears Food Security Bill (FSB) which aims to provides cheap, subsidised foodgrain as a legal entitlement to 75% of the rural population, would be proved as death knell for indian ecomomy which is also slowing down due to mis-handling of UPA-2. The idea is noble but the economic behind the FSB is simply in contrast to current economic scenario.
According to Food ministry officials FSB would increase the expenditure burden by just Rs 50,000 crore annually but that idea has no takers. According to our analysis FSB would have following implication :
- Uncontrolled Fiscal Deficit
- Stocking of Inflation
- More than 200,000 Cr p.a. in deficit
- De-motivational for Farm Productivity
- Deterrent to Expenditure Prudence
Whether it was Farm Loan Waiver or NREGA, all government expenditure schemes are political motivation and and they all results in to overburdening government finances in turn costs tax payer.
Anybody who knows basics of economics can realise the huge impact it will leave even after UPA-2 will cease to exist in office after 2014. It is the time we the people should stand up against dynastic politics and Leaders such as Sonia Gandhi to stop persuading their Political Agenda for personal benefit at a cost of Common People and tax payers money.