CUTS’ MEMORANDUM TO THE UNION FINANCE MINISTER, INDIA
IN THE CONTEXT OF THE UNION BUDGET FOR THE YEAR 2002-03
1. The year 2002 has started with new challenges on geo-politics, which are inter-wined with issues of governance. Rapid growth and use of the Internet facilitates, better interaction and exchange of information, ideas, people and goods, both within and across borders. These changes also offer hope for moving towards a new regime of international cooperation and governance, with India playing a major role.
2. However, governance does not mean regulation only. Better governance depends crucially on the effectiveness of markets. Secondly, issues relating to governance are coupled with many other aspects–of democratic deficit at various levels, of endemic poverty in sections of our society, etc.
3. On the effectiveness of markets, it is crucial that policies for reforming our economy are undertaken at right time and in proper sequence. Today, the country is witnessing the beginning of the second-generation economic reforms. We take this opportunity to congratulate the Government of India through the Hon’ble Finance Minister for initiating steps towards enacting of a number of economic and other bills, which are necessary for us to usher into economic reforms of a different kind. Competition Bill, Electricity Bill, Right to Information Bill will constitute pillars of the second-generation economic reforms. We urge the Hon’ble Finance Minister to take necessary steps for the passing of these Bills, among others, during the Budget Session, 2002, and to provide adequate budgets for these laws to be made truly effective.
4. A necessary condition for the success of the second-generation economic reforms is good governance through peoples’ participation in the reform process. Making government policies transparent through a participatory approach is the need of the hour. In this context, the following Paragraph of the Ministerial Declaration adopted at the Fourth Session of the Ministerial Conference of the World Trade Organisation (WTO), held in Doha, Qatar during November 2001 needs a mention.
“Recognizing the challenges posed by an expanding WTO membership, we confirm our collective responsibility to ensure internal transparency and the effective participation of all Members. While emphasizing the intergovernmental character of the organization, we are committed to making the WTO’s operations more transparent, including through more effective and prompt dissemination of information, and to improve dialogue with the public. We shall therefore at the national and multilateral levels continue to promote a better public understanding of the WTO and to communicate the benefits of a liberal, rules-based multilateral trading system.”
5. India is a signatory to this Declaration and therefore committed herself to promote better public understanding of a rules-based multilateral trading system at the national and international levels through, among others, improvement of dialogue with the public. A necessary condition for better understanding of the multilateral trading system is improved public knowledge on concomitant domestic economic policies.
6. Thus, we urge the Hon’ble Finance Minister to take necessary steps towards improved public knowledge on domestic economic reforms. This will not only make economic reforms acceptable to the public at large but will also enhance India’s image as a ‘good international citizen’. Over the last few years, the Government of India (and state governments) has taken several steps towards good governance and peoples’ participation in the policy implementation. We support the Government of India (and state governments) towards building necessary momentum for taking the process of economic reforms to the grassroots.
7. One way of making public at large aware of the virtues of economic reforms and thus, building constituencies for economic reforms is building the capacity of consumer organisations. The uniqueness of this approach is based on the fact that the consumer movement advocates for the economy as a whole, not for any particular sector of the economy. Consumers’ interest is national interest.
8. We urge the Hon’ble Finance Minister to announce the formulation of a National Consumer Policy, which will help in creating an empowered consumer and guide various Government Departments in harmonising their work towards implementing measures relating to consumer welfare. A draft National Consumer Policy was submitted at the last year’s meeting.
9. Another crucial factor for the success of the second-generation economic reforms is policy coherence and the necessary political will among the states. It has been recognised that over the last few years Indian polity has undergone several fundamental changes, which are essential for bridging the democratic deficit. India, as a state, is much more federal and plural than before and we congratulate the Government of India for taking steps towards building consensus among the states on economic reforms. We urge the Hon’ble Finance Minister to announce measures, which can harmonise the actions being taken by state governments with the broader goals of economic reforms of the country as a whole.
10. Lastly, and most importantly, radical measures are imperative for enabling a national movement for reforms. This includes the institutionalization of the National Development Council, which can be an effective platform for implementation of reforms, even if they are unpopular. The new NDC should be independent of the union government having a permanent secretariat of its own with a review and monitoring process, and close involvement of NGOs and the media.
Thus, CUTS advocates for:
- Announcement of a ‘Facilitation Fund’ in the Union Budget 2002-03 that will help consumer organisations to participate in the process of economic reforms.
- Adoption and implementation of a National Consumer Policy in letter and spirit and a rolling study on its implementation.
- Establish a new National Development Council for catalyzing reforms and policy coherence among the states and the centre.