Towards

Socialism

Capitalist polarisation in Indian
politics must end : Wider left unity needed for People's Alternative leading to
Socialist IndiaDebabrata Biswas, M.P., General Secretary, AIFB
Indian politics is now on the crossroads throwing a
challenge to left parties to end capitalist polarisation
in the country. This cannot be achieved unless we can forge wider left unity to
form the People's Alternative. Neither the Congress, nor the BJP, both being
the two sides of the same coin representing the
capitalist class interest aided by the world imperialist powers could not offer
any solace to the millions of hungry poor people of the country. Socialism can
only be the alternative to this capitalist domination. Hence, ours is the fight
against capitalism and imperialist globalisation. All
India Forward Bloc, founded by Netaji Subhas Chandra Bose, is committed to socialism. AIFB,
therefore, calls for socialistic reconstruction of the country as advocated by Netaji and asks the people to unite to Rebuild India in Netaji's way. Unfortunately, some of the left parties,
particularly the CPI(M), the major partner of Left
Front in
Not only the communalism, but other
divisive forces are also very active in
In 1947 Congress compromised with British
imperialism, causing division of the country, to capture power and enjoy the
creams of ruling power. Nehru family betrayed the cause of millions of hungry
exploited people of
AIFB National Council calls for this
united struggle, which can be achieved through a wider left unity ----- not in
a few states only, but throughout the whole country. AIFB believes this united
left fight should aim for establishment of Socialism in
AIFB National Council resolves to initiate
a new era in Indian politics. At Tripuri ---- the
venue of the 1939 National Congress session where Subhas
defeated the right reactionary forces with the support of all the then left
progressive forces --- AIFB will convene on 10th & 11th March 2008 a
convention of anti-imperialist forces ---- both national and international
----- and form the anti-imperialist platform to create a new era of
anti-imperialist struggle with Netaji's ideology.
[Extract from the speech delivered at the
open session of the AIFB National Council held at
Deployment
of police on democratic movement is deviation of LF policy.
Another tragic incident has happened at Dinhata
in
Within
11 months of Nandigram massacre, recurrence of Dinhata firing badly tarnishes the left image not only in
the state, but throughout the country and abroad. Instead of setting a role
model of a left government, the LF government followed the same anti-people
bourgeoisie way of governance. We expect the state government to review their
policy and to regret for this police violence, as well as to give its firm
assurance not to repeat the same. We demanded judicial enquiry, punishment of
the guilty police and administrative officers and immediate withdrawal of all
charges imposed on F.B. workers and leaders. We firmly affirm that this is not
the end of left movement in the country. We have a long way to go ahead to
fulfill our commitments for the welfare and up-liftment
of downtrodden people. It is high time to review our policy and performance unitedly to uphold the left image in the whole country.
NETAJI SUBHAS JAN - KRANTI
YATRA
HARIPURA
(GUJRAT) TO TRIPURI (
Start on Starting
Point Covering
Places
19th Feb.2008 Haripura (Gurjat) Covering Gujrat and
25th Feb, 2008
25th Feb,2008
01 March 2008
02 March 2008 Jhabua (Birth place of Ratiam,
Chandra
Sekhar Azad) Narshinggarh, Raisen,
03 March 2008 Sheoni (Netaji was jailed) Sheoni,
Chhindwara
04 March 2008 Anuppur (Netaji Statue) Anuppur,
Umaria, Dindori.
AIFB
CAMPAIGN FROM HARIPURA TO TRIPURI
The All
India Forward Bloc launches a campaign on Netaji from
Haripura(
The Caravan
-Subhas
Chandra Bose
The political stalemate is now broken. The
call of Ramgarh has borne fruit. The bugle that was
sounded there was echoed and reechoed all over the land and from the living
hearts of the people has come the response. During the last week, one has been
thrilled to read the papers from day-today. No longer are we merely criticising and cogitating.
No longer are we engaged in endless controversy and in hair-splitting
arguments on Local Struggle vs. National struggle. We are on the march. Annapurnaiah in Andhra, Senapati Bapat and ex-Civilian Kamath in
Bombay, Kisan leader Bhuskute
in Maharashtra, Professor Ranga in Madras, Ashrafuddin Chowdhury and Satya Ranjan Bakshi,
Secretary of the Bengal Congress and of the Bengal Forward Bloc respectively
and a host of comrades ------ belonging mostly to the Forward Bloc and the Kisan Sabha ----- are now in
prison. They have gone forth first and theirs is the glory. All honour to them.
The problem now is ----- what are we to
do? In 1930, when
Today, the same ultra-leftists are in a
similar situation. Like truly doctrinaire politicians and bookish
revolutionaries, they are standing aloof from the struggle that has begun. By
this policy, they will hurt nobody but themselves. The caravan will march on,
despite their indifference and possible obstruction. This is the time for
action ---- not for wordy warfare or hair-splitting over the meaning of words.
Reports that have reached us from
different parts of the country go to show that everywhere our functions have
been an unqualified success. In some places, Gandhiites
joined hands with Congress Socialists and 'National Fronters'
in order to frustrate our work, but they met with miserable failure. There can
be no doubt today that the masses are with us.
Is it not an irony of fate that the
National Front Group are not coming forward to join the National Struggle? They
could at least have come forward to intensify the local struggles and extend
their scope, leaving it to others --- to the Kisan Sabha and the Forward Bloc, to wit---- to work as they
liked. But their present policy appears to be almost like a 'dog in the manger' policy. They will neither join
the struggle themselves, nor permit others to do so. In 1930, those who had
gone in for a national struggle were condemned as counter revolutionaries:
today they are being condemned as disruptors of unity. The ultra-leftists have
yet to learn that that unity is real and is worth having which leads to action
and struggle. Unity which paralyses action is meaningless and ineffective and
can be described as the unity of the graveyard.
As the hours roll by, excitement and
inspiration are on the increase. As if to help us in our mission, the
Government struck on the first day and again on the last. The more they strike
and the harder they strike, the stronger will be the reaction and the greater
the response. The day has gone by when people would be cowed down by
repression.
As we march on, many others have to
follow, though rather tardily. The Rightists are setting up Satyagraha
Committees, War Councils and the like and the leaders are parading in shirts
and shorts. This is all to the good. But how long will this prelude last? When
will the real drama begin? If only it had begun at Ramgarh,
we would have been behind the Rightists and not ahead of them. But destiny has
forced us to act as the spearhead of the struggle and as the vanguard of the
national army. This is a role which will do honour to
anybody and no sacrifice is too great that may be necessary in order to fulfil it.
Let the drums beat and the bugles be
blown. Let youthful hearts pulsate with life and the blood dance with joy. The
hour of deliverance is at hand ---- we have only to do our duty and to pay the
price.
The supreme test is taking place now. The
chaff is separating from the grain, the Rightists from the Leftists. Out of
this ordeal, Leftism will emerge triumphant. The overthrow of Rightism will mean the defeat of Moderatism,
Reaction and Compromise. And when Leftism emerges triumphant, no power on earth
can deny
[Extracted
from the signed Editorial of Subhas Chandra Bose
published in the weekly "Forward Bloc", dt.
April 13, 1940]
Main Theme of AIFB National Council
Meeting Adopted at
AIFB for Netaji’s
The National Council Meeting of All India
Forward Bloc was successfully held at Tilak Patrakar Bhavan, Nagpur on 15th,
16th and 17th February 2008. 237 delegates from 17 states participated in the
meeting.
On 15th February morning at 9.30 a.m. Com.
N. Velappan Nair, Chairman of All India Forward Bloc
hoisted the party flag and Com. Debabrata Biswas, M.P., General Secretary of All India Forward Bloc
paid floral tributes to the martyrs. Central leaders and delegates garlanded
the photograph of Netaji Subhas
Chandra Bose and paid revolutionary homages to the
martyrs amid the slogans of All India Forward Bloc Zindabad,
Netaji Zindabad, Long live
martyrs etc. An exhibition of Netaji's photographs
and writings of and about Netaji was inaugurated
after the flag hoisting ceremony by Com. Subrata
Bose, M.P., Secretary, All India Forward Bloc. It was an exhibition of rare
photographs of Netaji, which throws light on untold
stories of Indian independent movement.
At 11.00 a.m., Com. Debabrata
Biswas, M.P. placed the draft document, resolutions
of current national and international issues before the delegate session. The
National Council Meeting condoled deeply on the death of five All India Forward
Bloc cadres due to barbaric police firing on 5th February 2008 in Dinhata,
A rally was organized on the occasion of
the council meeting. The rally started from Netaji Subhas statue at Manas Chowk and concluded at Patwardhan
Ground. A photo exhibition on Netaji was also
organized at Manas Chowk.
Before commencing the rally, the leaders of All India Forward Bloc garlanded
the statue of Netaji. The public meeting was presided
over by Com. N. Velappan Nair. Com. Debabrata Biswas was the main
speaker. He explained about the historical importance of the National Council
Meeting and the current national political situation. Com. Devidas
Bhore, General Secretary of the Reception Committee,
Com. Arun Wankar, All India
Forward Bloc Maharashtra State General Secretary, Com. Subrata
Bose, M.P. also addressed the gathering. Com. G. Devarajan,
secretary All India Forward Bloc conducted the proceedings of the meeting.
The second day session of the meeting
started at 9.30 a.m. 48 delegates participated in the discussion. Com. G. Devarajan and Com. (Dr.) Barun Mukherjee, M.P. secretaries of All India Forward Bloc
replied on the deliberations on international and national issues respectively.
The meeting has adopted the main theme document 'AIFB for Netaji's
The last day session discussed about
organizational report. Com. Debabrata Biswas placed the guide lines of organizational activities
and state General Secretaries and their representatives submitted reports about
organizational activities in their respective states. The leaders of the mass
organizations also placed their report. Com. Debabrata
Biswas replied on the organizational discussion and
announced the future course of action. He declared about the adoption of
council documents and assured the delegates that the views and suggestions made
by them will duly reflect in the final document. Com. N. Velappan
Nair declared the end of the National Council Meeting and Com. Gunwant Nagpure, Chairman of
Reception Committee made vote of thanks.
The National Council Meeting has adopted
the following future programme unanimously.
1. AIFB Campaign from Haripura
to Tripuri (Netaji Subhas Jan Kranti Yatra)
The
National Council Meeting of All India Forward Bloc has decided to launch a
campaign on Netaji from Haripura
(
The Reception Committee of Madhya Pradesh
will organise six
Netaji Jan-Kranti Yatras from different places and will culminate at Tripuri on 10th March. These yatras
will go around the whole Madhya Pradesh and will propagate the relevance of Netaji's ideology. Details of the yatras
are as follows:
1. From
Arora Colony,
2. From
Habibganj,
3. From
4. From
Babra, Jhabua (Birth place
of Chandra Shekhar Azad) 2nd March 2008 onwards (7 days)
5. From
Seoni (Old jail, where Netaji
was prisoned) 3rd
Marc 2008 on wards (7 days)
6. From
Anupur 4th
March 2008 onwards (7 days)
All the state units are requested to organise vehicular jatha in the
state and send representatives to the Tripuri meeting
and the anti-imperialist convention at
2. State-wise Anti-imperialist campaign
The
National Council Meeting of All India Forward Bloc has decided to organise state wise Political Jatha
against imperialist machinations in our domestic political matters and to
propagate the political philosophy of Netaji Subhas Chandra Bose as only alternative to save our nation
from the clutches of neo-imperialist forces. These state wise Jathas should popularise the
slogan of the party as 'AIFB for Netaji's
The state committees are requested to
convene their meetings at the earliest and chalk out the detailed programme of state wise campaign.
3. AIFB parliament march on
The
National Council Meeting of All India Forward Bloc has decided to organize a
people's march to the Parliament on the issue of
All the state leaders of the party and the
mass fronts are requested to attend the Parliament March to express the
solidarity with the struggling people of
4. AIFB campaign on Farmers
(Kisan ki Khushhali
Bina, Yeh Azadi Adhoori Hai)
The
National Council meeting of All India Forward Bloc has decided to launch a
nation wide movement on the issues of farmers. The All
All the state units of the party are
requested to organise farmer's march along with the
All India Agragami Kisan Sabha for the rights of the farmers with the slogan of
'Wipe out the tears of Farmers, otherwise the freedom has no meaning'. All are
requested to publish documents on the sorry plight of the farmers of the
country in general and the farmers of the respective states in particular as a
campaign material. The party will organise a Farmer's
March to Parliament after the completion of state campaign.
5. Membership
The membership renewal and enrolment of
new membership for the year 2008-09 will start from 22nd June-2008. As per the
earlier decision, all the state committees are requested to print the
membership forms in their respective languages and keep inform all the party
units about the renewal and enrolment process. The next party congress will
take place on the basis of this membership list.
The verification and scrutiny of the
membership at various level will take place as per the following schedule:-
Local/District - By end of
September, 2008
State - By end of November, 2008
Central approval - By end of December,
2008
State
and district leaders will present in the scruitiny
camps at district and local level.
6. 16th Party Congress
The 16th Party Congress of All India
Forward Bloc will be held in 2009. All the state units of the party are
requested to make all necessary ground level preparations for the forth coming
party congress.
The date, venue etc. will finalyse later on. If any state committee is interested to
host the next party congress, inform the central office immediately with proper
justification and plans.
7.
The National Council Meeting of All India
Forward Bloc univocally opined that making a revolutionary political party for
the new times and to face the challenges is not possible without proper
political training to the party cadres. The Council meeting has decided to
streamline the process of party school with time-bound programme
with an aim to train the rank and file of the party. All the state units are
requested to finalize the date and venue for the next state party school immediately
to the Central Office.
8. All
The
National Council Meeting of All India Forward Bloc endorsed the suggestion of
the Central Committee of All India Student's Bloc that the next National
conference of All India Student Bloc would be organized at New Delhi on 14, 15,
16 November 2008. All the lower units of the party are requested to organize
All India Student Bloc units in their respective areas and to hold the state
conference. All the state committees of the party are requested to take special
initiative to organize All India Student Bloc state units. State leaders are
requested to identify the issues of the student community and to organize
student movement for academic rights by giving special attention to inculate patriotism among the young generation.
9. All
The National Council Meeting of All India
Forward Bloc has further endorsed the suggestion made by the national leaders
of All India Agragami Mahila
Samity that the next National Conference of AIAMS
could be organized at Bangalore on 28, 29, 30 November, 2008. All the state
units of the party are requested to identify the issue of women such as
atrocities against woman, women reservation, equal wages for equal work etc.
and to organize women's movements in local and state levels. All the lower
units of the party are requested to form All India Agragami
Mahila Samity committees in
respective levels through movement before the proposed National Conference. The
Anganwadi worker's federation as suggested by TUCC
will also be formed at
10. All
The
National Council meeting of All India Forward Bloc unanimously endorsed the
decision of the Tripura State Council Meeting the party to contest
independently in the current Assembly election in protest against the big
brotherly attitude of the CPI(M), the leading party of Tripura Left Front. The
party will contest in 12 seats. The All India Forward Bloc is a founder member
of the state left front and always demanded three seats from the front. The
chairman of the Left Front promised several times to the All India Forward Bloc
leaders that the demand of the party will be considered next time. But these
promises have never materialized. The All India Forward Bloc demanded that at
least 10% of total seats (60) should be given to the allied parties. But the
CPI(M) leadership outrightly rejected our demand. Therefore, the State
Council Meeting, which is the highest policy making body of the party in the
state in between two state conferences has decided to contest in the Assembly
election independently. The National Council Meeting of the party extended all
sorts of supports to the state committee in their struggle for the matter of
political prestige.
11. Save Democracy Movement : Highlight the Dinhata Killings :
The National Council Meeting of the All
India Forward Bloc has decided to organise a nation-wide
'Save Democracy Movement' against the increasing onslaught on democractic people's movement. Police atrocities are
increasing day by day and naked violation of human rights are taking place
throughout the country. There is no exception in this regard that which party
is in power.
On 5th February, 2008, the All India
Forward Bloc,
All the state units of the party are
requested to organise save democracy movement in all
the states and highlight the barbaric incident of Dinhatta.
Resolutions
adopted at the National Council Meeting,
On National Issues
Barbaric
Police firing at Dinhata (
State-wide
'Bandh' observed in protest
As
per declared programme of mass agitation with 7-point
demand, including 100 days' work, proper BPL list and others, the All India
Forward Bloc, Bengal Committee observed Civil Disobedience in all the districts
of the state on 5th February 2008. About 3 lakh
people participated in civil disobedience braving police atrocities and mass
arrests throughout the state. But the peaceful civil disobedience programme at Dinhata of Coochbehar district,
The F.B. sponsored bandh
received spontaneous support from the people of all walks of life throughout
the state ------- both the urban and rural Bengal and public life came to a
halt giving vent to the people's anger, resent, hatred and protest against the
barbaric police action. The day witnessed many processions in support of the 'Bandh' and also large-scale arrests by the police. Road
communications including train services were almost paralyzed,
schools-colleges-offices-factories were closed.
The All India Forward Bloc congratulates
the people for making the "Bandh" a success
and the party is of the opinion further said, Dinhata
incident was a shame and unbecoming of a left front government. It reminded us
of Nandigram where 14 villagers were also killed by
wanton police firing on 14 March 2007. The question obviously arose in people's
mind, whether the major LF-partner CPI(M), which off late was trying to
unilaterally run the government, will rule the state with people's support or
with police bullets. Forward Bloc was not prepared to accept such position and
so it wanted to prevent creation of a third Nandigram.
Swaminathan Commission's recommendation for Contract Farming goes
against farmers:
The growth rate of agriculture and allied
sectors during the last three years has been Zero percent in 2004-05, six
percent in 2005-06 and 2.7 percent in 2006-07. Moreover, the whole plan period
performance was more alarming, as the agricultural growth rate was about 2%
during the IX plan, which declined to 1.8% per annum during X plan. In view of
this declining trend the government is now planning to achieve 4 per cent
annual growth in the agricultural sector during the Eleventh Plan (2007-12) and
has announced some measures for the purpose, including bringing out the
National Policy for Farmers, 2007, based on M.S. Swaminathan
Commission's recommendations.
While critically examining the
recommendations, some of them appear to be very encouraging, e.g. Cooperative
Farming, but a few, like Contract Farming can not be accepted as beneficial for
the farmers, particularly the small and marginal farmers.
Contract farming generally becomes
exploitive in character. Big interest groups or the corporate houses tend to
enter the farming business, the basis of which is exploitation of poor farmers.
In most of the cases, they force the farmers to produce those crops which will
be more profitable for them, without caring for the interests of the farmers.
Farmers do not have their own choice for crop selection, which ultimately
becomes detrimental to their interest. Even in most of the cases, farmers lose
initiatives, as they are bound by fixed pattern of work, and this ultimately
leads to lower yield. Generally, farmers are also not compensated for adverse natural conditions like draught
or floods. And above all, poor farmers stand to lose in respect of remunerative
prices, when the post-harvest market prices show upward trend. Poor farmers are
always the weaker side in case of price-bargaining prior to contract and hence,
the corporate houses always stand to gain. Although the Swaminathan
Commission has recommended a code of conduct for contract farming and
government intervention as a third party to protect farmers' interest, in
practice all these precautions never
work properly. Hence, their proposed 'non-exploitative pattern of contract
cultivation' is never feasible. On the other hand, poor farmers will be
benefited if the government sincerely tries to organise
cooperative farming.
UPA
Govt's worst record in farm suicides
The increasing trend of farmers' suicide
in some major states like Maharastra, Andhra Pradesh,
Madhya Pradesh - Chghatisgarh continues unabated inspite of much publicised relief
package of the Prime Minister. Significantly, when the relief packages of both
the Prime Minister and the state Chief Minister, totalling
Rs. 4825 crore, were being implemented in Vidharba region, the highest number of suicides occurred in
Maharastra state. Due to misuse of relief money and
basic issues relating to suicides not being properly addressed, the problem
remains unresolved. According to recently published report ----- 'Accidental
Deaths and Suicides in India, 2006' of the National Crime Records Bureau
(NCRB), all-India total of 17,060 farm suicides occurred in one year (2006).
Incidentally, Maharastra as a single state recorded
the worst figure (4453) in the same year and the mostly suicide - prone 4
states have shown an increase of 6.2 percent in such deaths.
NCRB data record 1,66,304 farmers'
suicides in a decade since 1997. Of these, the last five years ---- from 2002
to 2006 ----- proved worse with 87,567 farmers taking their own lives. A media
report commented that these figures meant that there had been on average one
farmer's suicide every 30 minutes since 2002. Inspite
of Centres' beating of dreams on a high GDP growth
rate, this increasing trend of farmers' suicides is indeed a very shameful
record for the UPA government.
The 2001 Census puts
Although the UPA government pledged in
NCMP to raise public spending in education to at least 6% of GDP with at least
half this amount being spent on primary and secondary sectors, but in practice,
What is of greater concern to
The EFA 2008 report also comes heavily on
Development
vis-a-vis Employment
Generation
Employment generation is reported to be
one of the major reasons in favour of Development and
Industrialisation. And of late the issue has also
generated a lot of public debates in various states, particularly in
A recent Question - hour discussion in Rajya Sabha may be referred to
highlight some facts in this respect. The government admitted that despite
increase in annual growth rate of Gross Domestic Product (GDP), the number of
employment opportunities in the organised sector is
decreasing.
The Minister further said that employment
in the organised sector declined by 15.02 lakh in March 2005, as compared to March 2000. The decline
in employment opportunities in the organised sector
is partly due to more investment in capital intensive rather than labour intensive technology in the organised
sector, outsourcing and right sizing of the public sector.
The Minister informed the House that based
on Employment Market Information, the total number of employees in the organised sector was 279.60 lakh
as on 31.3.2000 and 264.58 lakh as on 31.3.2005.
It is therefore admitted that the nature
and type of industry is more important than the number of industry set up, at
least so far the employment generation is concerned. We need more labour intensive industry than capital intensive industry.
It is true in case of both public and private sectors. But when this choice of
industry is entirely left to the individual industrialists, no appreciable
benefits can be derived so far employment generation is concerned. Development
of small scale and cottage industries, agro-based industries, food processing
industries and others would also be more helpful for employment generation and
growth of public economy.
UPA
Govt. miserably fails to contain Price rise
In spite of series of Parliament debates
and the govt.s' repeated assurances to take urgent
measures to check continuous rise in prices of essential commodities, nothing
tangible has so far been achieved and the price-rise continues unabated. Once
Jawaharlal Nehru vowed to hang the blackmarketeers in
public places to check price-rise. But there was no such public hanging at that
time, nor even the present Congress regime takes any punitive measures against
the dishonest traders and hoarders who are mostly responsible for artificial
price rise. Futures trading in agri-products and
other essential commodities are responsible for unusual upward market trends.
After repeated demands for ban on futures trading by the left and other
opposition parties, Union government has of late banned only four commodities,
viz. wheat, rice, urad and arhar.
But that has proved insufficient. Other essential commodities, including all
food grains are needed to be banned for futures trading so that market prices
are stabilised. Speculative marketing and hoarding
must be ruthlessly stopped. But nothing is done due to pro-rich and pro-traders
policy of the UPA government. Once the price of any commodity goes up, that
never comes down even in favourable condition.
Another spell of rise in petroleum prices will definitely aggravate the whole
market price situation. Hence, we oppose any such price-rise of petroleum
products, as there are various ways to avoid it. Constant publicising
GDP growth rate will not help the poor, so long price-rise can not be
contained.
National
Commission's reports on unorganised sector need
immediate government action
The importance of unorganised
sector workers which comprise about 93 per cent of the country's total
workforce has been repeatedly emphasised. But still
they are mostly deprived and exploited group of workers without having minimum
livelihood security and facilities. The Common Minimum Programme
includes establishment of a National Commission to examine the problems facing
enterprises in the unorganised informal sector.
Accordingly, a National Commission for Enterprises in the Unorganised
Sector (NCEUS) was duly formed under the chairmanship of Dr. Arjun Sengupta. Since May 2006,
the Commission has so far submitted about 4 very important reports and
documents, with many valid recommendations. But till now, no tangible steps
have been taken by the government to address the problems of unorganised sector workers. We demand that necessary
actions be taken immediately, with provisions in the forthcoming Union Budget
and comprehensive legislation too.
The National Commission for Enterprises in
the Unorganised Sector presented two reports to the
Prime Minister on 5th November, 2007. The two reports are on the i) 'Financing of Enterprises in the Unorganised
Sector' and on ii) 'Creation of a National Fund for the Unorganised
Sector (NAFUS)'. The recommendation on the creation of a National Fund follows
from the first report.
The submission of the above two reports
follows the earlier two comprehensive reports submitted by the Commission to
the Prime Minister on Social Security for Unorganised
Workers in May 2006 and a comprehensive report along with two Draft Bills on
Conditions of Work and Promotion of Livelihoods in the Unorganised
Sector in September, 2007.
Of the last two reports submitted to the
Prime Minister, the first deals with financing of the enterprises in the
non-farm unorganised sector. The second Report submitted
to the Prime Minister deals in detail with the recommendation of creation of a
National fund for the Unorganised Sector (NAFUS).
This Report on NAFUS gives the rationale, organizational model, functions and
sources of financing of the Fund. The mandate for the creation of this Fund
derives from the Common Minimum Programme of the UPA
Government.
The National Fund proposed by the
Commission is envisaged as a statutory body funded by the Central Government
and Financial Institutions that will primarily focus on non-farm micro
enterprises with investment of less than Rs. five lakhs.
The Commission's report reveals that this segment gets a mere 2 per cent of
Gross Bank Credit from Scheduled commercial Banks, and virtually no support for
marketing, technology, enterprise development although it constitutes 94 per
cent of all small enterprises estimated at 58 million in 2007 with a total
employment of 104 million. The Fund, as designed by the Commission, is expected
to meet these gaps. This Fund will be created on the pattern of NABARD and is
exclusively meant for meeting the financing and promotional assistance gaps in
the development of the Non Farm Unorganised Sector.
Being a statutory body it will leverage funds from the market and national and
international institutions to meet its objectives.
The primary focus of the fund shall be
primarily on enterprises with investment not exceeding Rs. five lakhs and overall target group will be limited to micro
enterprises (with up to Rs. 25 lakh investment) in
the non-farm sector. It may be mentioned that 98 per cent of all non-farm unorganised enterprises employ less than 10 workers.
The Commission feels that an exclusive
Developmental Financial Institution is needed to take care of the integrated
needs of the entire non-farm sector covering both financial and promotional
requirements of the sector. The
Commission's Report on Financing of the Unorganised
Sector reveals some startling facts namely -----
• only about 4 percent of non-farm unorganised enterprises have access to institutional
credit.
• Micro enterprises with investment less than
Rs. 25 lakh receive only 4 per cent and with
investment of less than Rs. five lakhs receive only
about 2 per cent of gross bank credit from scheduled commercial banks (SCBs).
• The lowest segment of the unorganised sector viz. artisan and cottage industries
received only 0.6 per cent of gross bank credit from SCBs.
The Report reveals that financing of unorganised enterprises is one of the lowest priorities.
The Commission has made comprehensive
suggestions for aligning the functioning of the banks to the needs of the
vulnerable sections of the country.
The other measures suggested are as
follows :
• Interest rates be on parity with
agriculture which pays 7 per cent on loans up to Rs. 3 lakhs.
Currently micro units pay an interest rate 16 per cent for loans above Rs. 2 lakh while large enterprises in the organized sector pay
only 6-7 per cent interest. The cost of credit makes the unorganised
sector uncompetitive.
• The Commission has also recommended that
viable State Finance Corporations and Cooperative Banks be also included as
Member Lending Institutions (MLIs) under the Credit guarantee Scheme.
• Single Multi-purpose Swarojgar
Credit Card be issued for unorganised sector
enterprises, etc.
Sensex crash hits the
government's growth projections
The recent Sensex
crash exposes the vulnerability and risks involved in the Indian Stock Market.
Both the recent boom and the sudden slump of Sensex
must have serious lessons for the future investors, particularly the small and
middleclass investors of our country who stand to be the worst sufferers in the
whole rise and fall game. It can not be denied that these small investors,
along with other domestic corporates and high-net-worth
investors, were attracted towards the share market with the hope to share the
benefits of the Sensex boom. But the government and
our public financial heads must have the responsibility to caution the
middleclass investors about the risks and vulnerability of the share market
boom, as they are supposed to be aware of the reasons and nature of such boom.
But they didn't care to take necessary steps in the matter, rather they have
continuously encouraged people to invest in shares and even they have had long-term
plans to divert the common people's hard-earned pension funds to share markets.
And hence, the inevitable results follow.
We may recall how the whole country watched with unbelievable interests and shocking surprise the steadily rising Sensex and the sudden crash during the recent past. There was much-celebrated rise of the Sensex from 10,000 - level early in 2006 to more than 20,000-level in recent times. It is now accepted in all quarters that this boom was driven by foreign Institutional investment (FII) inflows. As such, it should have been known that if the boom was caused by a supply-side push of foreign capital into a developing country like ours, 'any development that cuts off or reduces supply is likely to stall and reverse the boom. And if the cut-off occurs all of a sudden, the reversal is bound to be sharp. This is what happened in the middle of January