Press: Dr. Subramanian Swamy on Indian Economy

Saturday, 21 September 2013

Rajan's policies will lead to economy crash, he should be removed: Swamy

Swamy, a noted economist, alleged that the move shows Rajan's short-sightedness and foreign mentality and demanded his immediate removal.

PTI

21 Sep 20:19 pm IST

New Delhi: BJP leader Subramanian Swamy today said the economy is "sick" and heading for a crash by 2014 due to the falling Rupee and other ills and hit out at RBI Governor Raghuram Rajan for increasing the Repo Rate.

Swamy, a noted economist, alleged that the move shows Rajan's short-sightedness and foreign mentality and demanded his immediate removal.

"His economics has been known to be the same as that caused the US Depression of the 1920s, namely, following a conservative fiscal policy. Just when investment and capital market needed an injection of adrenalin, Dr Rajan asphyxiated the investor. By mid-2014, the government will be on the verge of default of payments," Swamy said.

He was speaking to reporters at his maiden press conference after merging his Janata Party with BJP last month.

Calling for a new reform policy, the BJP leader said India has forex reserves of only USD227 billion and there is danger of reverse of short-term capital outflow by panic cashing of Participatory Notes, hawala operations and rigged short-selling of the rupee abroad.

Swamy cautioned that any crisis in the country will lead to outflow of this money.

He also maintained that the balance of payments is skewed as our imports are higher. "Balance of payments'current account deficit as a ratio of GDP is highest since 1990, at 4 per cent," Swamy said.

The BJP leader also referred to the falling Rupee and said while it had dropped by only Rs 4 to a Dollar between 1999 to 2004 when NDA was in power, the slide has been of Rs 23.42 in the last nine years of UPA rule.

He said India's household savings- which is the highest in the world- has fallen due to price rise.

Swamy claimed that while 69 million jobs had been created during the NDA regime, Planning Commission figures show that only three million jobs have been created between 2004-12.

He said the rupee is under pressure as Indian money is deposited in tax havens abroad through the hawala route. This money is then invested in India through Participatory Notes.

Giving suggestions for improving the state of the economy, Swamy claimed that Rs 70 lakh crore of Indian money is stashed abroad illegally. If this is brought back Indians would not have to pay income tax.

He said that enough revenue can be generated by fair auction of spectrum, coal blocks, mines, and natural resources like Thorium found in southern states. "It would be better if income tax is abolished in India,"

Swamy said. Asked if he was voicing the BJP's view as he was speaking from the party platform, Swamy said, "I am here as a member of the BJP. The party is aware of my views. I am not in favour of income tax as it is a tax for harassment."

Swamy said though he favoured FDI, he is against FDI in multi-brand retail as companies like Walmart have an unfair advantage over Indian traders who do not get a level playing field.

"Our economy is in a financial ICU... on a ventilator," he said, adding that the UPA government should be ousted in the next elections.

http://m.firstpost.com/economy/rajans-policies-will-lead-to-economy-crash-he-should-be-removed-swamy-1125263.html

http://bjp.org/images/pdf_2013/annexure_sep_21_13.pdf

http://www.youtube.com/watch?v=eJeSqUXC17Y

Statement of Dr. Subramanian Swamy, Former Union Cabinet Minister

By all economic criteria, the Indian economy is today sick and in a tail spin heading for a crash unless effective steps are taken soon to reverse the trends by a new economic reform policy.

http://bjp.org/index.php?option=com_content&view=article&id=9022:press-dr-subramanian-swamy-indian-on-economy-21092013&catid=68:press-releases&Itemid=494

http://www.docstoc.com/docs/160666030/On-the-road-to-Indian-economy-crash--(Dr-Subramanian-Swamy-21-Sept-2013)

Comments on Firstpost:

chetan_1
6 hours ago
Rajan should understand the role of Gold ESPECIALLY in India. Curbing Gold by various means will cause money to flow from Gold to n-number of commodities -- like say into Onions or Tomatoes etc., raising inflationary expectation, velociy of circulation of money -- which ultimately has to lead to Hyper Inflation like in Zimbabwe and or civil war. Sooner he understands this lesser damage will be caused by Government/RBI.Gold is the shock absorber. Rise of price of Gold is harmless
like benign tumor -- it will be converted to cancer by curbing gold.
Remove socialism from constitution. Fire all government employees -- go for all out privatization.
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Nirguna
7 hours ago
Very good Suggestion's. Going by Swiss - US pact, Money used against terror is now throughly sealed and efforts are being made in every country to check black money. This parallel economy has started hitting Europe hard and with US - its fuelling terrorism. WIth India, its used to destabilise markets and to run hawala network. Dr Swamy has rightly suggested the means to curb these practices. But in India, Industralists run the country with political parties acting as their stooges. Dr Swamy, now in BJP can act against these in the overrall interests of everybody including industrialists only if he is put in charge of Finance. But then, isnt it too much ask for in confused BJP ?! only time will answer these. People like him should be used to the fullest advantage of nation. Rarely you come across a politician who is intelligent, knows world better and loves India to the core and has knowledge of law and defence too. Multi faceted personality. only role fit - PM !
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tp
8 hours ago
Thought Swami was better material than this. Better full frontal broke than Greece!
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Sathya
8 hours ago
Perhaps he should become the PM of India!
Swamy is a rabble-rouser ...
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Raj
8 hours ago
Swamy is a statistician and not an economist!
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Shyam
8 hours ago
Mr Swamy is targeting the wrong person. RBI governor can only do so much. If the central govt. is bent on destroying the economy by excessive spending leading to large fiscal deficits & high inflation, there is little an RBI gov can do!!!
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um
8 hours ago
he sure has some valid points,this guy is a genius
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- Sathya um
  8 hours ago
  he's a rabble-rouser
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abhishek
8 hours ago
Rajan is useless. Inflation will kill common man.
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- Sathya abhishek
  8 hours ago
  How come you say Rajan is useless?
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  - Shashidhar V Sathya
    7 hours ago
    
    as if people take loan to buy onions . because of hike in interest rates onions usage will come down and hence the price of onions !!!!.
    this is what RBI is expecting keep dreaming !!!!
    
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Asoka Chaudhari
9 hours ago
India would become Switzerland or Singapore if it abolish income tax. We should have only flat consumption tax. Taxing production, saving & income is worst way to run economy. it suit politically but very bad for business. To abolish income tax the govt has to roll back NAREGA, FOOD BILL & numerous other well fare scheme. I would be happy if BJP abolish the income tax. The income tax is to control the power as it continually threat the businessman & people because they can raid you any time for any reason so basically control on everyone.
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- chetan_1 Asoka Chaudhari
  7 hours ago
  There is a world wide movement to abolish income tax. Just 2% increase in VAT is sufficient to bridge the shortfall.
  Even this two percent is not required if all government servants are fired(going for all out privatization). Income tax idea is just a political weapon.
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- Tamal Mukherjee Asoka Chaudhari
  8 hours ago
  But you do pay income tax in Singapore (0-20%), not sure about Switzerland. Check Wiki.
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  - Asoka Chaudhari Tamal Mukherjee
    3 hours ago
    −
    
    i meant to say like Singapore in terms of development, we have issue of black money but if we have no income tax there wold be less black money, less corruption, we spend so much time in filing income tax, return , and the hassle of paperwork , income tax officer behave like tax payer are their slave & they mercy on us by not raiding us. Interesting development to look forward if BJP come to power. Also it can free up labor & resources that are stuck in these paper work & moved to other productive areas.