Union Budget 2013-14: Focuses on Economic Growth, Middle Class To Pay More

Finance minister P. Chidambaram presented the Union Budget for 2013-14 in the Parliament on February 28. It was Chidambaram's eighth annual budget, the second highest by anyone in India after a record ten by former Prime Minister Morarji Desai. Overall, it was 82nd Union Budget in the Indian history, including interim and special-situation budgetary proposals, since the first one of independent India was presented by then finance minister R.K. Shanmukham Chetty on November 26, 1947.

Individually, Chidambaram presented the Union Budget for the eighth time, the second-highest by any finance minister. The maximum number of 10 budgets have been presented by Morarji Desai, while Pranab Mukherjee (currently President of the country), Yashwant Sinha, Y.B. Chavan and C.D. Deshmukh have presented seven budgets each in the past.

Plan Outlay

The finance minister has proposed a 29.4 percent hike in the plan expenditure for the union budget 2013-14. The plan expenditure for the next fiscal will be about Rs.5.53 lakh crore, the finance minister said.

The budget expenditure is Rs.16,65,297 crore and the plan expenditure is Rs.5,55,322 crore," Chidambaram said, adding that the plan expenditure in 12th Five-Year Plan was revised to Rs.14,30,825 crore or 96 percent of budgeted expenditure.

Growth Rate

India’s economic growth, as per official estimates, decelerated to 5 percent and 6.2 percent in the past two years, from 8.6 percent and 9.1 percent in the two years preceding them. Chidambaram said the Indian economy was today constrained by three factors: high fiscal deficit, slow growth and high inflation.

The finance minister said a whopping Rs.16.65 lakh crore (Rs.16.65 trillion or nearly $300 billion) would be spent under plan expenditure during 2013-14, which will be 30 percent higher than the outlay for this fiscal.

Fiscal Deficit

While doing a shade better than the targeted fiscal deficit of 5.3 percent of Gross Domestic Product (GDP) at 5.2 percent for the current fiscal, the finance minister has stuck to his target of 4.8 percent of GDP for 2013-14, even while stepping up defense allocation by 14 percent over the revised estimates in the current fiscal.

Similar hikes have been proposed in various sectors. although it is clear that he managed to create a cushion through compression in spending during the current financial year. Expenditure under several key heads, including roads and rural housing actually fell in the current fiscal compared to the previous year.

Tax Rates

The 2013-14 Budget proposed a tax cut of Rs.2,000 for people earning an annual income of between Rs.200,000 and Rs.500,000 and said anything beyond that was not possible given the current circumstances. The finance minister said any hike in the exemption limit for direct tax that is paid by individuals would take millions out of the tax net and was neither a desirable proposition, nor feasible. Accordingly, he proposed a Rs.2,000 tax credit for those in the first slab. This measure will benefit 1.8 crore (18 million) tax payers," he said, adding that this would entail an outgo of Rs.3,600 crore ($650 million) to the exchequer.

The finance minister sought to kick-start the engines of growth by providing incentives for productive investment, stepping up expenditure in social sectors to invigorate the economy in the longer term and giving a token tax break at the lowest slab rate to offset the inflationary burden on the middle class.

The Budget proposed to levy a surcharge of 10 percent on individuals whose annual taxable incomes exceed Rs.1 crore. The surcharge will be levied for the 2013-14 financial year. The finance minister said there are only 42,800 individuals in the country who will be liable to pay the surcharge.

To provide for the various increased allocations, the finance minister moved to tap the well-heeled by way of a one-year surcharge of 10 percent on the ‘super rich’ section of tax payers – all 42,800 of them, that is — along with duties on imported or domestic luxury vehicles such as SUVs, mobile phones (priced over Rs. 2,000), and what has been the tax horse of most Finance Ministers —cigarettes. With other minor tinkering of duties, including Tax Deducted at Source (TDS) on sale of property worth Rs. 50 lakh, the net additional tax revenue in the kitty works out to Rs. 18,000 crore.

However, given the challenges that he faced by way of low growth, high inflation, the widening fiscal and current account deficits coupled with lower than targeted revenue collection during 2012-13, Chidambaram may have disappointed taxpayers looking for some major breaks. But he did provide a tax break of Rs. 2,000 to individual tax payers with taxable income of up to Rs. 5 lakh. This itself is estimated to benefit 1.8 crore tax payers and work out to a revenue sacrifice of Rs. 3,600 crore. Likewise, first-time buyers of affordable homes will get an additional deduction of interest of Rs. 1 lakh for home loans up to Rs. 25 lakh, which will be over and above the current Rs. 1.5 lakh deduction allowed for self-occupied dwellings.

Defense Allocation

The government has marginally increased its defense spending by 5.31 percent than 2012-13. The defense budget for 2013-14 starting April 1 will be Rs 2,03,672 crore, an increase of Rs 1,93,407 crore more from the 2012-13 budget.

The revised budget after the mid-fiscal cut was Rs 1,78,504 crore in December 2012. The hike is 14.10 percent, much lower than last year’s 17.6 percent hike. Also the share of defense spending in the GDP will be reduced from 1.9 percent for the year ending March 31 to 1.79 percent of the GDP. The share of defense spending in the overall expenditure will be 10 percent of government expenses, a decrease of 11 percent this year.

Finance Minister P. Chidambaram said that India plans to spend up to 2.03 trillion rupees ($37.7 billion) on defense next year, up from a revised 1.78 trillion rupees this year.

The finance minister said 867.41 billion rupees will be spent to buy defense equipment in the next fiscal year, up from this year's about 695.79 billion rupees. The government had originally planned to spend 795.78 billion rupees on purchasing defense equipment this year.

Despite the cut in this year's defense budget, India will become the world's fourth-largest defense spender by 2020, behind the United States, China and Russia, and surpassing France, Japan and the United Kingdom. It is predicted that India's defense spending will reach $65.4 billion in 2020.

Boost to Agriculture

Finance Minister P Chidambaram hiked the agriculture budget by 22 percent, increased farm credit limit to small and marginal farmers from Rs 5,75,000 crore to Rs 7,00,000 crore in 2013-14 and announced setting up “nutri-farms” pilot project.

The sector got a major boost, in line with the UPA’s ambitious food security Bill (which got an allocation of Rs 10,000 crore) and the next general election, as sufficient sops have been announced for farmers in the Budget.

Also for the first time perhaps, the government set aside separate funds - Rs 500 crore - to start a program on crop diversification.

Education Sector

The Union Budget set aside a budget of Rs 79,451 crore for the entire education sector, including literacy and higher and technical education. This represents a meagre Rs 5,395 crore increase over the budget estimate of Rs 74,056 crore for the Ministry of HRD in the last financial year. The hike constitutes 7.2 percent over 2012-13, whereas last year the increase for the education sector budget was a handsome 18.6 percent. Expenditure on education as a proportion of the GDP has increased from 2.59 percent in 2007-08 to 3.31 percent in 2012-13.

The Plan Budget is Rs 65,869 crore which is Rs 4,442 crore more than Rs 61,427 crore in last fiscal. It will certainly ask for more money with the Right to Education Act (RTE) in mind.

The budget for school education is Rs 49,659 crore which is only 8 percent more than last year. The allocation for the Sarva Shiksha Abhiyan (SSA) is up from Rs 25,500 crore last fiscal to Rs 27, 258 this year an increase of Rs 1,758 crore which is very low considering SSA is the main vehicle to implement the RTE Act. Midday Meal Scheme has been allocated Rs 13,125 crore as against Rs 11,937 crore last year, an increase of Rs 1,260 crore.

Skill Development of Youth

The 2013-14 Budget has allocated Rs.1,000 crore to develop job-oriented skills among youth. Assuming that 10 lakh (one million) youth can be motivated in one year, skill trained youth will give enormous boost in employment and productivity," Chidambaram said, while presenting the federal 2013-14 budget to the Lok Sabha, the lower house of parliament.

The finance minister allocated Rs.1,000 crore (Rs.10 billion) for the "ambition", saying that it would be a "trigger for skill development in the country".

Infrastructure

Infrastructure got a major thrust in the 2013-14 budget with Finance Minister P. Chidambaram announcing a slew of measures to boost sector's growth, like raising Rs 50,000 crore through taxfree bonds and setting up of major ports.

In some other decisions which would boost the infrastructure development in the country, the government also said that it would set up a road regulatory authority in the financial year 2013-14 to address financial stress, construction risk and contract management in the road sector and start work on two more industrial corridors between Bangalore and Chennai and Bangalore and Mumbai.

"The power transmission system from Srinagar to Leh will be constructed at the cost of Rs 1,840 crore, Rs 226 crore provided in current budget," Chidambaram said in his budgetary proposals for next fiscal.

In a move that is also strategic for the region, the proposed 220 kV line from Srinagar to Leh, to be implemented by Power Grid Corp, will pass through Kargil, Drass, Khalsi and is aimed at enhancing the reliability of power supply.

Highlights

* Fiscal deficit for 2013-14 pegged at 4.8 percent of GDP and 5.2 percent in 2012-13

* Plan expenditure pegged at Rs. 5,55,322 crore and Non-Plan at Rs. 11,09,975 crore

* New taxes to collect Rs. 18,000 crore for government

* Voluntary Compliance Encouragement Scheme launched for Recovering service tax dues

* Rs 14,000 crore earmarked for capital infusion in public Sector banks in 2013-14

* Refinance capacity of SIDBI raised to Rs. 10,000 crore

* TUF Scheme for textile sector to continue in 12th Plan With an investment of Rs. 1.51 lakh crore

* No change in income tax slabs

* Relief of Rs. 2,000 for tax payers in tax bracket of Rs2-5 lakh

* Ten percent surcharge on persons with taxable income of over Rs. 1 crore

* Tobacco products, SUVs and mobile phones to cost more

* Income limit under Rajiv Gandhi Equity Savings Scheme Raised to 12 lakh from Rs. 10 lakh

* First home loan of up to Rs. 25 lakh to get extra Interest deduction of up to Rs. 1 lakh

* Duty free limit of gold import increased to Rs. 50,000 For male passengers and Rs. 1 lakh for female passengers

* India’s first women’s bank to be set up by October

* Concessional six percent interest on loans to weavers

* Commodity transaction tax of 0.01 percent proposed on non-agri futures traded on commodity bourses

* Securities transaction tax brought down to 0.01 percent

* No change in basic customs duty; normal excise and Service tax rates unchanged at 12 percent

* Handmade carpets and textile floor coverings of coir or jute exempted from excise duty

* Excise duty on SUVs increased to 30 percent from 27 percent

* Chidambaram says India to become $5 trillion economy, And among top five in the world by 2025

* Rashtriya Swasthya Bima Yojana benefit extended to Rickshaw pullers, auto and taxi drivers, among others

* ‘Nirbhaya Fund’ of Rs. 1,000 crore to empower women and Provide safety in the wake of Delhi gang rape incident

*Rs 9,000 crore earmarked as first installment of balance of CST compensation to states

* Defense allocation at Rs. 203,672 crore, education Rs. 65,867 crore and rural development ministry Rs. 80,194 crore

* Rs 10,000 crore earmarked for national food security toward incremental cost

* Farm credit target set at Rs. 7 lakh crore as against Rs. 5.75 lakh crore in 2012-13

* Direct benefit transfer scheme to be rolled out in the entire country during tenure of UPA government

Assessment

At first glance, the budget may appear harmless to the middle-class. In fact, it might even appear friendly what with all those improvements in housing loan deductions and stock market investments. But make no mistake, this budget will bite the average citizen in more ways than one.

Just take the seemingly innocuous proposal to impose service tax on all air-conditioned restaurants. With most decent restaurants — we are not talking of the up-market ones here — climate-controlled, eating out will become at least another 12 percent more expensive. Remember that restaurants are in the process of revising their price-lists even now with rising prices of food commodities.

Cellular phones are now a necessity and smart phones are increasingly becoming so as they help you do your daily business on the go. As much as 97 percent of all telephone connections in the country are cellular. Yet, smart phones (or phones that cost more than Rs.2,000) will now become pricier with the sharp rise in excise duty to 6 percent from 1 percent. In addition to driving business to the grey market, this proposal will also undo the efforts to push people into using their mobiles extensively for transactions.

It can be said that it must not be forgotten that the finance minister appears to have placed enormous trust in the growth figures going northward in the coming months, and with that he hopes the revenues will follow. After all, by not changing the income tax slabs or too significantly altering the indirect tax proposals which previously existed, Chidambaram hopes to mop just under Rs18,000 crore from his new tax proposals.

However, since that is far less than what the Government needs to meet its expenditure, the Minister is banking heavily on upward economic growth to trigger revenue generation. But growth has dipped from a high of nine percent only a few years ago to around five percent now. While the Minister hopes for a turnaround to six percent and above, there remains a big ‘if'.

Economic Survey 2012-13: Reflects India's Grim Reality, Cautions Against Growing Taxes

Finance Minister P. Chidambaram presented the pre-Budget Economic Survey for 2012-13 to Parliament on February 27. The Survey reflects the grim reality that India is facing a severe slowdown and must act fast to spur investment, restart stalled projects, cut interest rates and contain its fiscal deficit.

Growth Rate

The Survey made it clear that this fiscal’s five per cent growth, the slowest in the past decade, could no longer be blamed on external factors alone, and the government will have to act on the domestic front to come out of the slump.

The Economic Survey, while projecting an optimistic growth rate of 6.1-6.7 percent for 2013-14, stated that to contain the fiscal deficit the government should widen the tax base and cap subsidies, particularly through better targeting and plugging leakages. It also claimed the downturn was more or less over, and that the economy was looking up. Claiming that the downturn was “more or less over” and that the economy was looking up, the Survey projected a cautiously optimistic growth rate of 6.1-6.7 percent while conceding that the Gross Domestic Product (GDP) growth for the current fiscal was likely to slip to the decade’s low of five per cent — compared to the estimates by the Central Statistical Organisation (CSO) of 6.2 percent for 2011-12 and 9.3 percent the year before.

Fiscal Deficit

The Survey had pegged the fiscal deficit at 5.1 percent for the GDP for 2012-13, which the finance minister later revised to 5.3 in view of the rising expenditure and subdued revenue collection. For the new fiscal, the finance minister has committed to bring it down to 4.8 per- cent.

The 2012-13 Survey notes that the government needs to contain the fiscal deficit especially by shrinking wasteful and discretionary subsidies. The Survey said: "Controlling the expenditure on subsidies will be crucial. The domestic prices of petroleum products, particularly diesel and LPG need to be raised in line with their prices prevailing in the international market.

In addition, delays in getting permissions for projects need to be curbed so that investment can pick up. Implementation of GST, if approved, would create an integrated market and bring more producers in the tax net. Also, the direct benefit transfer scheme recently rolled out on the AADHAAR platform will target subsidies better.

Agriculture Reforms

Economic Survey states that with agriculture growth rate falling short of the four per cent target in the past five years, the country’s annual economic report card (the first since the beginning of the 12th Five-Year Plan period), calls for increase in yields and reforms like a suitable sustainable strategy to maximize agricultural income and make it a viable option.

The farm sector achieved 3.6 percent growth during the 11th Five year Plan (2007-12) – higher than growth of 2.5 and 2.4 percent during ninth and 10th Five-Year Plans but lower than expectations of 4 percent growth target.

Therefore, in the face of stiff challenge of feeding its growing population, the Survey has sought urgent reforms to boost crop yield and private investment in infrastructure to motivate farmers.

Economic Survey for 2012-13 has emphasized putting in place a strategy for farm development in the eastern and northeastern regions amid saturation in crop yields in Green Revolution belt, especially in the States of Punjab and Haryana.

Tax Rate

In what may bring cheer to the well-heeled in the wake of a raging pre-Budget debate over squeezing more out of the super-rich class, the Survey suggested the government’s efforts to raise additional revenue should be through widening of the tax base and not by increasing the rates. The Survey stated: “It is much better to achieve a higher tax-GDP ratio by broadening the base which is taxed rather than increasing marginal tax rates significantly — higher and higher tax rates impinge more and more on incentives to undertake taxable activity, while encouraging tax evasion.”

Several experts, including PMEAC Chairman C. Rangarajan, have pitched for higher rates of taxes on super-rich. The Survey, prepared by a group of economist led by Chief Economic Advisor Raghuram Rajan, said it is better to achieve fiscal consolidation partly through a higher tax-GDP ratio than merely through reduction in expenditure as it would only hurt development spending.

The Tax-GDP ratio touched a peak of 11.9 percent in 2007-08, but declined to 9.6 percent in 2009-10. It was 9.9 percent in 2011-12. “Raising the tax-GDP ratio to above the 11 percent level is critical for sustaining the process of fiscal consolidation in the long run,” it said.

Gross tax revenue in April-December 2012 has grown by 15 percent to over Rs. 6.81 lakh crore. However, the growth in tax collection was “significantly” short of the growth envisaged in Budget. The tax collection until December 2012, was 63.2 percent of Budget estimates, lower than the last five-year average of 69 percent.

Rate of Inflation

Predicting that headline inflation may fall to 6.2–6.6 percent by next month, the Survey stated that elevated food inflation would continue to remain an area of concern as it inched towards double digits in December 2012. While 2012, the inflation was driven by protein items, this year it has been due to increase in prices of cereals such as wheat, rice and maize.

Inflation which is one of the major areas of concern for the United Progressive Alliance (UPA) Government, has remained in the range of above seven per cent since December 2009, while to add to its woes food inflation, too, has remained on the higher side during the same period, and according to the Economic Survey for 2012-13, easy money policy of major developed and developing nations may further aggravate inflationary expectations in India.

The survey further added that inflation has remained muted in the current financial year and declined to a three year low of 6.62 percent in January 2013. The average wholesale prices-based inflation in 2012 (April-December) moderated to 7.55 percent from 8.94 percent in the corresponding period of 2011-12.

Industrial Production

With the spurt in factory output last October turning out to be an aberration in the wake of sharp downturns in the months after, the latest Economic Survey has sought to describe the industrial production scenario as a ‘mixed picture’ of sluggishness bottoming out as well as continuing for a little longer period.

What came as a surprise to the government while India Inc. maintained a ‘we said so’ stance to clamor for easing of interest rates, was that industrial growth, as measured by the Index of Industrial Production (IIP), witnessed a smart recovery with a robust 8.3 per cent expansion in October, 2012.

Despite the downward bias, the Survey has highlighted at least two factors which point to some optimism on the industrial front.

First is the data on frequency distribution of products/product groups within the IIP basket which indicates that the number of products with negative growth has declined from 182 in the fourth quarter of 2011-12 to 160 in October-November 2012.

The second positive factor is the Reserve Bank of India’s ‘Business expectation index’, which showed moderately positive growth during the third quarter of the current fiscal after posting persistent negative growth for the previous six quarters. Since the RBI business index tracks IIP growth fairly closely, the change in trend suggests a possible bottoming out of IIP growth moderation.

Foreign Direct Investment

According to the Economic Survey, Foreign Direct Investment (FDI) in India slumped by 43.3 percent at $15.85 billion in April-November period of the current financial year as compared to $27.93 billion in the corresponding period previous year. The overseas investment flows in top five services declined by 9.7 percent at $8.19 billion during the period under review.

The Survey stated that overall FDI inflows increased by 33.6 percent in 2011-12. Overseas investment inflows in services surged by 57.62 percent in the financial year ended March 31, 2012.

The document presented a day ahead of the Union Budget 2013-14 pointed out that the government has taken many policy initiatives to liberalize FDI policy for services sector. This includes increasing FDI limit from 49 percent to 74 percent in teleports and DTH and cable networks, permitting FDI up to 74 percent in mobile TV, up to 49 percent in scheduled and non-scheduled air transport services and up to 50 percent in multi-brand retail trading.

The Survey stated that the government has also amended the existing policy on FDI in single brand product retail trading.

Health Sector

The country’s spending on health remains abysmally low with the Survey revealing that the spending on health, as compared to the spending on the rest of social services, has actually been declining in the country. Raising alarm over the decline, the survey has called for increased focus on health and education if India's demographic dividend is to be used to its advantage. Between 2011 and 2016, as many as 63.5 million workers, mainly aged between 20 and 35 years, will join India's pool. For this segment to be productively engaged, spending on health and education must remain consistent, the survey says.

But the ground situation paints to a sorry picture. The combined central and state expenditure on social services as a proportion of total expenditure increased from 22.4 per cent in 2007-08 to 25.1 per cent in 2012-13 and the spending on education among all the social services also increased over this period from 43.9 to 46.6 per cent.

However, the combined general spending (federal and states) on health has fallen over the past five years from 21.5 per cent to 19.2 per cent.

Petroleum Subsidies

The 2012-13 Survey has called for addressing the key issues of petroleum subsidies, clarity on gas pricing policy, petroleum price distortion and concerns over various disputes pertaining to the New Exploration Licensing Policy (NELP). It stated that addressing the key fiscal risk of petroleum subsidies is critical in better fiscal marksmanship.

It stated further that the overall subsidy bill of the government, it said, was likely to overshoot the target of Rs.1.79 lakh crore this financial year due to higher crude oil prices. The government had put the petroleum products subsidy at Rs.43,580 crore, food subsidy at Rs.75,000 crore and fertilizer subsidy at Rs.60,974 crore, taking the total subsidy bill to Rs.1,79,554 crore for 2012-13.

Employment Rate

The 2012-13 Economic Survey stated that the employment rate between June 2011 and June 2012 went up by approximately 7 lakh led mainly by the IT and BPO sector which accounted for almost half of the increase. It stated that upward trend in employment since July 2009 continues despite the economic slowdown.

A sector wise analysis shows that the textiles sector including apparels saw 1.70 lakh job additions, followed by transport sector (0.45 lakh), metals (0.26 lakh), gems and jewelry (0.19 lakh) and automobiles (0.11 lakh) in June 2012 over June 2011.

The survey said that employment in handloom/power loom and leather sectors has marginally declined during this period.

It said that there has been a sustained and consecutive increase in employment in both the public and private sectors covered at overall level during the last eleven quarters with a total addition of 30.73 lakh employment during this recovery period.

According to the Survey, India is on the brink of a demographic revolution with the proportion of working-age population between 15 and 59 years likely to increase from approximately 58 per cent in 2001 to more than 64 per cent by 2021. Moreover around 63.5 million new entrants to the working age group between 2011 and 2016, the bulk of whom will be in the relatively younger age group of 20-35 years.

The Survey added that the annual growth rate of employment in the private sector in 2011 was 5.6 per cent whereas that in the public sector was negative.

3 Years of UPA2 Government: Crucial Political, Economic Policies Remain in State of Drift

The Congress-led UPA2 (United Progressive Alliance) Government completed three inglorious years in office in May 2012. Given the fact that it has all but abandoned the governance of the country, constantly harangued by allies and put on the mat by the Opposition, Prime Minister Manmohan Singh’s regime must consider it a miracle that it is still in power. The past three years of the government have been marked by a complete paralysis in decision-making and an erosion of stature of the prime minister. Crucial political and economic policies have remained in a state of drift because there is no leadership at the top. As Prime Minister, Singh should have been directing the battle to revive the government, but he is found nowhere in the front. That is because he now leads the government only in name, and his Ministers and allies know it well.

The prime minister is in charge of neither the political agenda of the country nor its economic agenda. In other words, he is a lame-duck prime minister biding his time before he is ousted by the electorate or replaced by his party’s high command led by Congress president Sonia Gandhi. Meanwhile, everyone in the UPA Government and outside is having fun at his cost. But the headless government’s continuance is not a matter of amusement for the country, which is paying a heavy price for Singh’s pusillanimity and inaction.

Political Front

On the political front, allies are regularly issuing threats and arm-twisting the government because the Congress as a party and Singh as the prime minister have failed to reach out to their partners or allay their apprehensions on several contentious issues. The growing lack of trust between the Congress and its partners in the UPA Government — not to mention the widening divide between the government and the Opposition — has led to key decisions being either kept on hold or rolled back. Many of these decisions which have become victims of the government’s incompetence relate to the economic well-being of the people and their security. 

No amount of chest-thumping by the UPA and its acolytes over its imagined achievements is going to change the reality that the Congress-led government has failed in every way that a government possibly can. Most importantly, the government has lost the people’s trust, which is clearly evident in the results of the recently held election to five States. UPA2 is on life-support — alive but not living.

Unattended Issues

However, as Congressmen across the board will tell you, there is no real sustained debate — or at any rate, any formal putting of heads together in party fora — on how to achieve all this. The big issues, freedom of expression versus community sentiments, market versus control, etc are never thrashed out to evolve a party view.

A senior party functionary pointed out that even the A.K. Antony Report, which analyzed the Congress' performance in recent Assembly elections to five States, including U.P., will be seen only by the Core Group (whose members include Singh, Sonia Gandhi, Pranab Mukherjee, P. Chidambaram, and A.K. Antony, and Sonia Gandhi's Political Secretary, Ahmed Patel) that meets once a week.

As for the Congress Working Committee (CWC), a more representative body, it seldom meets. It is little wonder then that the Congress is now a party where senior functionaries and ministers themselves scramble for information, where intrigue replaced any world view as ideology a long time ago, and ginger groups are a thing of the hoary past.

Optimism and Reality 

It was an acknowledgment that Dr. Singh had played a stellar role in the party's spectacular victory, drawing in support not just from middle class metropolitan living rooms but rural India as well: across Uttar Pradesh, I recall voters — cutting across caste and religious lines — saying they hoped the UPA, under Singh, would return to power and steer the country through the global economic meltdown.

But three years later, as the UPA readies itself to celebrate its eighth anniversary in power, the government and its Prime Minister have lost their sheen, swamped by a slew of financial scandals, the ham-handed response to the Anna Hazare campaign and rising prices. Congressmen, not Opposition leaders, are beginning to ask whether the Sonia Gandhi-Manmohan Singh partnership has run out of steam, and whether this unique power-sharing arrangement has led to ambivalence on policy issues, crippling effective decision-making. Finally, they are even asking whether the government needs a new face to lead it to the general elections scheduled just two years away, in 2014.

Pranab Factor 

That face could have been Rahul Gandhi, the Congress yuvraj, but his own lack of enthusiasm for taking on the job at this stage, compounded by the party's disastrous showing in the recent Assembly elections in Uttar Pradesh has ensured that he will not be taking over the reins, anytime soon. It could have been Sonia Gandhi, but she made it clear in 2004, when the position was hers, that she was not going to take it. It could also have been the party's troubleshooter, its one man brains trust, Finance Minister Pranab Mukherjee. But most senior functionaries and ministers rule out that possibility even though a majority agrees that of those available and no Gandhi willing, he would be the popular choice in the party for Prime Minister.

Of course, the finance minister's name is currently in circulation for another job — that of the next President, and he is certainly emerging as the Opposition's popular choice for a consensus First Citizen.

NCERT Textbook Issue 

Neither is there any system in the party that can respond to the challenges of the times. The recent NCERT textbook controversy, a cabinet minister stresses, should have evoked a considered response from the party: “Textbooks,” he said, “play a key role in a democracy. The response to the objections to the Ambedkar cartoon should not have been left to the HRD ministry.” If there is no serious internal debate, the minister said, people in the party are unlikely to own decisions: the problem with allowing Foreign Direct Investment in retail, he said, is not the opposition of allies or other parties: “We ourselves haven't made up our minds, so we talk of evolving a consensus.”

Eliminating Terrorism

The Congress-led government should not demonstrate softness in approach toward terror attacks. Unfortunately, that is what the UPA has been showing all these years. Its leaders speak in different voices on the growing terrorism menace.

How long will the current state of affairs continue? After every major terrorist incident, the instinctive response of the government is to constitute a committee or form a new investigative body on top of the existing, inefficient anti-terror set-up. In the aftermath of the 2008 Mumbai terror attacks, the government realized the need for a central investigating agency to combat terrorism. As a result, with the unanimous support of all political parties the National Investigation Agency (NIA) was created. However, this agency has proved ineffective in preventing terror attacks and tracking down terrorists in the country. The 2011 serial blasts in Mumbai followed by the Delhi High Court blasts and the German Bakery bombing in Pune the previous year could neither be prevented and nor were they properly investigated. The NIA was also accused of allegedly offering bribes to name RSS members in the Ajmer blasts case.

The UPA Government wants to create another anti-terror organization called the National Counter-Terrorism Centre. It is time the government realized that bad policing cannot be supplemented with more policing. The need of the hour is to improve coordination between investigative agencies and state governments, create a more comprehensive database of suspected terrorists and streamline the anti-terror operations, rather than encroach upon the powers of the States.

The current state of affairs makes it amply clear that these extremists have no concern for development and they intend to usurp power by first dominating the countryside and then moving toward the cities. And, hence, the soft approach being taken by the government makes India an even easier target. We cannot afford being the soft state that we are. Merely pumping funds into development is not the solution to the Maoist menace. Similarly, removing or diluting the Armed Forces Special Powers Act (AFSPA) in Jammu and Kashmir would severely hamper the capabilities and morale of the Army.

The country is in dire need of a more nuanced approach to dealing with issues of national security. Mere half-baked policies will not succeed. Our security will continue to be compromised so long as this UPA Government tries to politicize and pressure the stakeholders in the crucial decision-making process.

Countering Terrorism in India: Major Political Parties Fail To Break Logjam Over Proposed NCTC

The one-day meeting between Prime Minister Manmohan Singh, Home Minister P Chidambaram and the Chief Ministers, representing virtually all the major political parties, was held in New Delhi on May 5. The meeting that was organized on the setting up of the National Counter Terrorism Centre (NCTC) remained inconclusive after steadfast opposition from chief ministers, including those from the Congress, United Progressive Alliance (UPA) allies, the Bharatiya Janata Party (BJP) and those of regional parties.

The opposition to it in the present form leaves the federal government with no option but to go back to the drawing board to redraft the NCTC, probably give it a new name. It will have to prune some powers of the proposed body and, in all possibilities, remove it from the ambit of the Intelligence Bureau (IB).

With chief ministers strongly opposed to the NCTC in its current form, the Home Ministry has no option but to remove the antiterror body outside IB and to have a mechanism for mandatory coordination between central agencies and state police forces.

Home Minister P Chidambaram made it abundantly clear that his ministry would work on removing the biggest hurdle in forming the anti-terror body in his concluding remarks at the chief ministers’ conference that were released officially on May 6.

Emerging Key Sticking Issues

Two key sticking issues emerged after the meeting. One that the anti-terror body should not be under the control of IB. Two, the counter-terror body - in whatever shape it is formed - should not carry out independent operations in states.

The NCTC, an anti-terror body proposed by the Union Ministry of Home Affairs on February 3, is not acceptable to chief ministers in its present form. 

The states which did not agree on the NCTC in its present form include a couple of Congress-ruled states, all BJP-ruled states and the states ruled by regional parties like the Akali Dal in Punjab, the National Conference (Jammu and Kashmir), the Trinamool Congress (West Bengal), the Biju Janata Dal (Odisha) and the AIADMK (Tamil Nadu). Many chief ministers questioned the logic of putting the NCTC under the IB.

Possible Options

One of the possible options is splitting the work of the NCTC-type body. A counter- terror body with central command could have access to IB databases on suspects, informers, friends of suspects and financiers for analysis. Operations could be handed over to the National Investigative Agency (NIA) formed after the November 2008 Mumbai attacks. Since the NIA was formed under an act of Parliament, Chief Ministers would have no objections to it.

The second contentious issue is of having only joint operations of central forces and state police forces. The chief ministers, even those of Congress and UPA allies-ruled states, made it clear that the NCTC type-body could not carry out independent operations -- arrests or detentions of suspects -- in states without prior information to the state DGP.

One of the options being studied is the possibility of forming small nodes of the NCTC type-body in states. These would have a dedicated unit of the state police force attached with the central agency team. As most state capitals already have a small central agency team, staffing the nodes would not be problem.

The joint team would be kept in the loop on all information and would simultaneously keep the state DGP informed. Haryana Chief Minister Bhupinder Singh Hooda was among those who suggested joint training of state and central forces at the meeting.

Instrument of Subversion

When Manmohan Singh says the NCTC is not meant for facilitating the federal government’s intrusion into the domain of the State Governments and Chidambaram seeks to allay the States’ apprehensions that this is yet another instrument of subversion of the Constitution, they do so in the hope of softening the tough stand taken by the chief ministers, especially of those States where the Congress is not in power. But the fact that their protestations have failed to move hearts and minds reaffirms, though not for the first time, what has been known for long now: Neither commands credibility.

There can be an endless debate on the need for an over-arching Central authority to deal with counter-terrorism across States. Those who argue in favor of the proposed NCTC have made points that cannot be entirely ignored. However, those opposed to the idea of erecting such a super-structure have raised issues that cannot be brushed aside. But much of the debate has been based on theoretical precepts that are borrowed from others’ experiences and are not necessarily rooted in the Indian reality. As Gujarat Chief Minister Narendra Modi says, a robust, well-trained and well-equipped local police force is the best weapon to counter terrorism; after all, it is the local policeman who is, and shall remain, the first respondent. Second, to nibble away at the States’ constitutional rights, in this case maintenance of law and order, can never be acceptable, more so when the intentions of the federal government are questionable.

Pleas and Assurances

Undoubtedly, it is not a positive sign that despite the prime minister and the home minister’s impassioned pleas and assurances to dissenting states, the deadlock between the federal government and some states on the setting up of the NCTC could not be resolved. This should not, however, come as a surprise because the 10 dissenting states had made their stand clear beforehand. While most of the dissenters were non-UPA-ruled states and had a stake in keeping the pot boiling, the steadfast opposition of Trinamool Congress’s Mamata Banerjee and to a lesser degree Mulayam Singh Yadav and Omar Abdullah cannot but be deemed to be a blow to the Congress which spearheaded the move to set up the NCTC.

The scathing criticism of the federal government on the issue by Tamil Nadu Chief Minister J. Jayalalithaa was along expected lines but while it was reassuring to the opposition, it was a reminder for the Congress that it was up against a wall.

However, the Manmohan Singh government, on its part, merely restated its earlier position and made no efforts to address the specific provisions which the dissenting states were objecting to. For instance, the argument that the NCTC would undermine the states’ police powers was denied by both the prime minister and the home minister but there was no indication that the Centre was prepared to clothe the state police with greater powers to deal with terrorists while building up the NCTC as an apex body to coordinate action.

Assessment

Clearly, some of states chief ministers do not sufficiently appreciate the sophisticated features of international terrorism which has targeted India for three decades; its reach, resources and swiftness of mobility of its deadly practitioners who flit across boundaries; the ultra-modern nature of communications and fighting equipment it employs; and the enormous funds at its disposal, not to mention ideological, political and occasionally ground-level support that becomes available to it. All of this was encapsulated in the November 2008 Mumbai terror attacks.

Explosion Outside Delhi High Court: Terror Acts Continue

A high intensity briefcase bomb exploded near Gate No 5 of the Delhi High Court on 7 September, killing 11 persons and injuring 90 in a major terror attack that struck the National Capital after a gap of three years. Parliament unequivocally condemned the explosion outside the Delhi High Court and adjourned the proceedings till the government gathered facts and made a statement in both the Houses.
Lok Sabha and Rajya Sabha Adjourned
The Lok Sabha (lower house of the Parliament) was adjourned until 1230 when Home Minister P Chidambaram was expected to make a statement, while the Rajya Sabha (upper house of the Parliament)was adjourned until 1400.
At the outset, Lok Sabha Speaker Meira Kumar condemned the explosion as a dastardly act and asked the government to make a statement.
Cutting across party lines, leaders condemned the explosions as a cowardly act and said the Lok Sabha cannot continue with business "while people continue to die just over a kilometer from Parliament."
Leaders’ Reactions
BJP veteran L K Advani condemned the incident and urged the Speaker to adjourn the Lok Sabha until the government made a statement on the explosion outside the High Court.
Mulayam Singh Yadav, former Uttar Pradesh chief minister and BSP leader, also asked the Home Minister to make a statement on the issue and requested the Speaker to adjourn the House for the day.
He also said that some foreign nationals came into the country undetected, carried out such incidents, and got way.
JD-U President Sharad Yadav shared the views expressed by members and said the fact that the explosion occurred within a kilometre from Parliament was disturbing.
CPI-M leader Basudeb Acharia termed the explosion as a "disturbing incident" which should be condemned not only by the House but by the entire country.
He too said that the Lok Sabha should be adjourned until noon and the home minister should make a statement on the issue when the House meets.
Bahujan Samaj Party leader Dara Singh Chauhan condemned the explosion and asked the Speaker to adjourn the House until the government made a statement.
Shiv Sena leader Anant Geete noted that even Parliament had been a target of terror attack and the entire nation has to fight this menace unitedly.
DMK leader T K S Elangovan condemned the explosion and asked the Home Minister to "look into it" and take action.
AIADMK leader M Thambidurai strongly condemned the explosion and agreed with the views of his colleagues that the House be adjourned till the Home Minister makes a statement.
Akali Dal leader Harsimrat Kaur Badal said the Lok Sabha should not conduct business till the government made a statement on the incident.
Parliamentary Affairs Minister P K Bansal then informed the House that the Home Minister would make a statement at 1230 following which the Speaker adjourned the House until then.
In the Rajya Sabha, Chairman Hamid Ansari adjourned the proceedings until 1400 to allow the Government to collect information on the explosion.
When the House met for the day, Chairman Hamid Ansari said that a "disturbing news" had just trickled in about a bomb explosion outside the Delhi High Court.
"There are reports of some casualties. This is something to be condemned," he said. "As soon as facts are available, we will request the government to share it with the House," he said, adding that it could be possible by around 1400 and adjourned the House until then.

Pakistan-China Friendship: Gilani Visits Beijing

Reiterating friendship with Pakistan during the recent visit of Pakistan Prime Minister Syed Yousuf Raza Gilani, China warned in clear terms that the international community should respect integrity and sovereignty of Pakistan and should not forget its contribution to the war on terror. China has announced to supply 50 JF-Thunder warplanes to meet Pakistan's defense requirements. It has also announced 700 million yuan as aid for reconstruction of the flood-affected area and 100 million yuan loan on soft terms. It has signed nine memorandums of understanding in banking, trade, industry, agriculture, information technology sectors, and implementation on Saindak projects.
Strained Pakistan-US Relations
The announcement and the agreement that China made during the visit of Prime Minister Gilani, where he met his Chinese counterpart Wen Jiabao regarding Pakistan's defense and economic assistance are the outcome of the everlasting Pakistan-China friendship that has become a strong bond over the past 60 years and it is not in the power of anyone to break or weaken this chain now. The Pakistani prime minister paid visit to China at a critical time when relations between Pakistan and the United States were at their lowest ebb because of the Abbottabad operation and drone attacks. As a result of the US intervention and its strategy to keep Pakistan under constant pressure, and its desire to use the country according to its own will in the so-called war on terror, the Pakistan-US relations have become strained.
Since it was impossible for India to remain silent in this situation, it also started hurling threats to Pakistan. The Indian Air Force chief first issued a statement that his country can launch surgical strikes in Pakistan in self-defense. At the same time, India unleashed a propaganda campaign against Pakistan. In their separate statements, Indian Defense Minister A.K. Anthony and Home Minister P. Chidambaram strongly criticized growing relations between Pakistan and China, China's unilateral announcement about Pakistan's defense, and defense agreements. They announced to counter it by enhancing their (India's) defense preparedness. India's criticism of Pakistan-China relations and announcement to enhance its defense capabilities under the pretext of growing relations between China and Pakistan makes it clear once again that India wants to become mini-super power of the region. It has full support and patronage of the United States in its ambition and the defense and strategic agreements concluded between the United States and India during the visit of the US President Barack Obama to India last year are a clear proof in this regard.
This is a scintillating reality that China is a time-tested friend of Pakistan and Pakistan's integrity and stability is the cornerstone of China's regional strategy. However, as General (retried) Hamid Gul, former chief of the Inter-Services Intelligence, has said, that in spite of being deep and close friend, China will not fight for us because it is against the foreign policy and strategy of China.
Difference between China and the United States is that the Untied States neither follows any principle or international regulation for its interests, nor does it refrain from landing its troops in any region or any country. Similarly, clandestine acts in all the concerned and important countries, through CIA under preplanned objectives and targets, are also an important part of the US policy. On the other hand, China has neither committed flagrant aggression in any part of the world despite all sorts of international pressure and expectations, nor any report about China's clandestine activities came to light. In the backdrop of this clear situation, expectation on the part of the Pakistani rulers that China will physically come to the assistance in case of any possible the US or Indian aggression will be tantamount to committing suicide.
Similarly, China's economic policy is also crystal clear. China does gladly extend technical assistance and manpower to friendly countries but making a country beggar in the name of aid is not part of its economic policy. Since China's economic and political system has its foundations in communism, and since making weak segments and countries economically and financially strong is its prime objective, China always supported Pakistan in such projects that may help it stand on its own feet. According to reports, when Prime Minister Yousuf Raza Gilani requested for immediate financial aid in view of financial deficit and fiscal hardship in the next budget, the Chinese leadership turned down this request with great love and politeness saying giving cash contribution (alms) to friendly countries is not part of China's financial policy. Since the Pakistani rulers have developed the bad habit of getting direct financial aid from the United States, the United Kingdom, World Bank, and the IMF on stringent conditions, and now that these institutions have hinted at stopping aid to Pakistan after the Usama Bin Ladin episode, and some severe conditions are being attached, for further aid, the Pakistani rulers, as usual, tried to steer the drowning boat of country's economy to safety by visiting China. However, like a good and genuine friend, China gave it the recipe of getting rid of the aid once and for all and expressed the desire to assist through investment instead of giving cash aid.
China's Support to Pakistan's Sovereignty and Integrity
It is the impact of the way, in which the Chinese leadership expressed it friendship with Pakistan in clear terms in the current testing time, like the past, that India did not take much time to change its harsh tune against Pakistan. The same change can be seen in the statements of the US leadership. The United States had persistently been talking to Pakistan in threatening tone until clear and emphatic announcement by China but once the Chinese stance came to light, many US officials, including Hillary Clinton, have stated that Pakistan had no knowledge, at official level, about the presence of Usama Bin Ladin in Abbottabad.
Similarly, the visit of Senator John Kerry and Marc Grossman, US special envoy for Pakistan and Afghanistan, to Pakistan immediately after Prime Minister Gilani's visit to China, and formal announcement about launching joint operation in future indicates that the Chinese announcement to declare Pakistan's sovereignty and integrity as cornerstone of its foreign policy played an important role in pacifying the US outrage and anger.
Lesson for Pakistan From China's Progress
Doubtless, China is our time-tested and all-weather friend but it is unfortunate that neither we learnt any lesson from China's progress and everlasting friendship nor did we make any meaningful planning to achieve self reliance. Despite excellent relations with China at official and government-level, attention was never focused to promote people-to-people contacts in t between the two countries.
Since all personal interests of our aristocracy are linked with the West and the United States, we are tied in bonds of friendship with China under strategic compulsion but unfortunately, despite all out friendship and sympathies of China, the hearts of our aristocracy throb in unison with the west and the United States in spite of their threats and deceptions. This is the very basic reason that in spite of all sympathy and sincerity on the part of China, everlasting relation of friendship could not be established between the people of Pakistan and China that should have been established.
Demand of Situation
Time has come for Pakistan to stand on its own feet and break the begging bowl of the West and the United States and make model of China's progress our ideal. By doing so, Pakistan can start journey on the great highway of progress and prosperity.
For this new journey, Pakistan will have to promote our political, defense, economic, and commercial relations with its neighbors and genuine friendly countries like China, India, Iran, and Turkey on priority basis instead of its distant relatives such as the United States and the United Kingdom.

Omar Abdullah's Concept of Autonomy for Kashmir

Jammu and Kashmir Chief Minister Omar Abdullah has been repeatedly saying that Kashmir is a political problem, and it could not be solve through economic measures. He says mere economic packages would not help.

Omar Abdullah's tone and tenor shows he is proud of efforts to find a political solution. Omar says he said this openly even before Prime Minister Dr Manmohan Singh that power supply in Kashmir cannot solve the issue. A political solution has to be found for a political problem.

Need For Political Solution
Some political observers feel Omar Abdullah has not said anything new, whereas others feel that by avoiding calling Kashmir an integral part of India, Omar Abdullah has been creating doubts in the mind of the federal government. Some leaders of Omar Abdullah's party consider his attitude as dangerous. This time, by talking of the need for a political solution recently the chief minister has shown that he did not mind openly expressing his views.

No one protests when Omar Abdullah talks of a political solution. One has to agree with him that power and water supply cannot resolve the Kashmir issue. However, there are doubts that his boldness may cost him dearly. The reason is that there are many people in New Delhi who consider Jammu and Kashmir to be an economic and not a political problem. They feel people have been agitating for basic economic necessities and not for right to self-determination or autonomy. Such elements can be angry with the chief minister.

Demand of Situation
As far as Omar Abdullah is concerned, he finds it in his favor that Home Minister P. Chidambaram has already said that Kashmir is a unique problem, which needs to be solved politically. The differences between the chief minister and separatists are no secret. Their stands are poles apart.

However, they must have been impressed by what Omar Abdullah has said. At the same time, communal leaders in India may dub Omar Abdullah as a separatist.It can well be asked from Omar Abdullah what is his concept of autonomy, on the basis of which he has been demanding a political solution.

Use of Military: If Not Now, Then When?

A spurt in Maoist violence is taking place speedily. Their network has spread in seven states of the country -- West Bengal, Bihar, Jharkhand, Orissa, Chhattisgarh, Andhra Pradesh, and Adivasi (native tribal people) forest regions of Maharashtra, and is trying to spread its tentacles to other states as well.

Responsibility of States
Former Home Minister Shiv Raj Patil did not recognize Maoists as any grim threat as he maintained that 'out of the country's 10,000 police stations only 361 and out of 100,000 villages only 1,400 villages are affected by Maoism, which works out to just one-three percent of the total area of all villages. Even otherwise, law and order is the responsibility of the states.'

The truth is that since 1989 the influence of Maoists has expanded to several states and over 1,300 citizens and 6,000 security personnel have been made victims of their violence. They mustered up so much courage that after their massive attack on the Jahanabad prison and Police Lines, they started series of strikes through big groups. Five hundred Maoists struck Nalagarh in Orissa, killing 14 policemen by attacking the police training center and escaped with over 700 firearms and ammunition.

Anti-Maoists Campaign
Following the anti-Maoists campaign at Malkangiri in Orissa, when the squad of Gray Hound commandos of Andhra Pradesh was being ferried in boats, the boats capsized as Maoists attacked, killing 35 of them. Thereafter, Maoists went ahead with their strikes on railway stations, schools, block headquarters, police stations, and centers of security forces in various states and the government continues to talk in terms of strengthening police stations.

The police systems in the state are generally weak and there is acute shortage of manpower in police stations and armed forces. They do not have arms with which they can counter Maoists equipped with modern weapons. The number of police stations and police personnel has not increased in commensurate with the rise in population.

Increasing Strength of Security Forces
In the wake of the Mumbai attack, P. Chidambaram took over as the home minister and took a number of steps to increase the strength of policemen and security forces and providing them with modern weapons. The CRPF was entrusted with the task of tackling Maoists, but they have their limitations.

Notwithstanding all this, the Maoist activity continues. Recently, they attacked the Eastern Rifles camp at Silda in West Bengal, leaving 24 soldiers dead. On the eve of Chidambaram's visit to Nalagarh (West Bengal), Maoists launched attacks at two different places, killing two security personnel. Even then he declared that military will not be used but Maoists will be wiped out within three years. Within 24 hours of his announcement, 1,000 Maoists exploded landmines in Dantewada district of Chhattisgarh, blew up the patrol vehicle of the Central Reserve Police Force (CRPF), killing 83 of them. At least 150 CRPF personnel are still missing.

The government goes on experimenting even in such grave matters. In Jammu and Kashmir when peace returns, the government at the instance of the People's Democratic Party (PDP) leadership or the ruling party National Conference leaders reduces the strength of the military there, as a result of which, cross-border infiltration increases and a spurt in violence takes place. Likewise, nonutilization of the military boosts the Maoists' courage. Two examples of Punjab and Sri Lanka are before us where peace could be restored with the use of military.

In order to wipe out Maoists, it has become imperative to use troops trained in guerilla and jungle warfare by equipping them with modern weapons. The mindset of ruling leaders is that the use of military will bring bad name, but one may ask whether a bad name is not being earned due to the Maoist attacks. They also think that the families of those killed will be satisfied with the compensation of Rs.1-2 million. Our leaders care a fig for the common people because not a single member of their family gets killed in such attacks.

Elimination of Maoists
The government took effective steps when bomb explosions took place in the vicinity of the residences of ministers and MPs and when militants attacked the Taj Hotel and the Oberoi Hotel in Mumbai as rich people stay there.

Chidambaram has spoken in terms of elimination of Maoists within three years. But by that time Maoists will fortify themselves. At present, he is engaged in strengthening his forces by paying a monthly salary of Rs.3,000 ($60) to the Adivasi and rural security personnel. Owing to the government's policy of thinking in long-term and complacent approach not only the courage of Maoists is being bolstered but also that of the dacoits and criminals in North India where incidents of loot and murder are taking place in broad daylight. Hence it is high time the military is pressed into service.

Naxalism and Government Action

The situation has turned extremely grim after the killing of over 80 security forces by Maoists. While families of those killed wail and mourn, politicians are engaged in accusations of each other. Various questions being raised over the government strategy to tackle Maoists are becoming the subject of controversy.

In this context, federal Home Minister P. Chidambaram offer to quit followed by the rejection of his resignation can be termed part of this controversy. In certain quarters, it is being dubbed as a mere drama whereas some believe it to be a move emerging out of his helplessness.

Lack of Clarity and Firmness
Amid all this, it has come to the fore that there is an utter lack of clarity and firmness among the federal and state governments on the approach of dealing with the problem. Some governments of states where Maoists are active are being accused of lacking the necessary potential to counter the menace effectively. Recently, when Chidambaram visited Lalgarh, the stronghold of Maoists in West Bengal, there took place a lot of bitterness between him and West Bengal Chief Minister Buddhadev Bhattacharya. An impression had gone around that no joint strategy was being formed by the federal and governments of Maoist-hit states.

The federal government would extend support to governments of Maoist-hit states, so that the regions affected by Maoist violence could be liberated from the clutches of these militant elements. Under the fresh joint strategy, the second step would be to address social and economic issues pertaining to the people inhabiting such areas, so that the administration machinery could be made effective in Naxal-affected (Maoist insurgency) areas of the states concerned. This will include construction of schools, health centers, roads, and provision of potable water. It clearly manifests that there still exist a large number of places where people are deprived of basic amenities of life.

In our view, the federal government has failed on this front because it could not succeed in creating influence in the Maoist-hit areas so far. The federal government ministers often issue statements on this issue at all levels, yet no impact has emerged. It seems the lack of cooperation among the defense forces, state governments, and the federal government is aired from time to time, yet nothing has come to the fore to this effect over the recent past.

Big Challenge Ahead
Maoists, meanwhile, have achieved a major success in enhancing their influence in major swathes of the country. In the circumstances, there is no scope for issuing clarifications and indulging in rhetoric, now. Instead, in the wake of the big challenge posed by Maoists in Dantewada, there is the need to show such performance as should succeed in overcoming the existing worrisome situation.

For, eventually action will prove results. Hence, the people of the country would feel satisfied only when positive impact will come to the fore through an effective anti-Maoist campaign.