Wretched Economy in Punjab !

Political rhetoric about the upswing in Punjab’s economy aside, the state has slipped from sixth spot to twelfth in six years as per the latest edition of the Economic Freedom Index (EFI).

The Economic Freedom of the States of India, 2012, which ranks 20 states on three parameters -- size of the government, legal structure and security of property rights, and regulation of business and labour -- debunks reasons given by politicians to explain the sorry state of affairs in Punjab. It maintains that the huge power subsidy bill, fiscal crunch, tapering off of the Green Revolution, failures in agricultural marketing and inability to catch the services revolution have led to the decline in the state’s economy.

The report claims that the state sharing its border with a hostile neighbour or terrorism causing a decline in the state’s economy were mere myths created by policy-makers to absolve themselves of responsibility for the state’s steady decline.

While most other states such as Gujarat have dramatically improved their ratings, the report says that the freedom rating (indices used to rate states) has remained almost static for Punjab, showing that not much effort is being put in to improve its condition. The report, which has undertaken a study called ‘Why Punjab has suffered long, steady decline’ by noted economist Swaminathan S Anklesaria Aiyar, has said that the chief culprit for the fiscal crunch in Punjab is free power to farmers.

Taxing the Rich ..... and the poor

Well the idea of taxes has developed from the ancient times when kings used to collect taxes on the pretext of taking care of their kingdoms. When the rulers vowed for the welfare and concierge of their citizens.

Prior to seeking higher taxes from its citizens the Indian Government should consider doing its bit first. It should ensure that all the basic amenities are provided for and if not then there’s at least a plan for the same to be provided in future.

Merely by taxing people, rich or poor, and filling out the coffers on the pretext of reducing CAD (current account deficit) won’t solve the problem.

Well it appears to everyone all around the world that by merely increasing the taxes this entire problem of stagflation and higher CAD will get solved.

Here are some interesting quotes from prominent people in the business:

Diesel Price Hike

A SMALL step towards de-regulation and a BIG leap towards zero subsidy.

Everyone has to recognize, that either way the international price of fuel has to be paid for. 

Either the government pays it in terms of subsidy or the customer pays it directly based upon individual usage.

It is always better to keep financial transactions short and direct. This way there is less chance of seepage and more accountability can be sought after.

Now every individual will be responsible for their own fuel bill as per personal requirements. One way this will also reduce wastage of fossil fuels in the coming days.