CPM latest: Govt’s international treaties must get House OK

In its comments to the Approach Paper to the Eleventh Plan, the CPM said the Planning Commission “ignored” priorities on public investments, employment generation and ways to address the agrarian crisis.

CPM general secretary Prakash Karat said the Approach Paper highlighted the achievement of a target growth rate of 8-9 per cent without considering the “fallacy” of such a trickle-down approach to economic development.

The party’s comments on the Approach Paper to the Eleventh Plan, that has been sent to Prime Minister Manmohan Singh and Deputy Chairman of Planning Commission Montek Singh Ahluwalia, says rather than treating it as an objective in itself, GDP growth must help expand employment and improve social sector indicators.

But with the Left now ruling three states, the CPI(M) has advocated greater state autonomy. The CPI(M) general secretary said states, with regard to their relationships with the Centre, were getting stifled and there were a “host of issues” on which conditions were being imposed on states.

VAT, he said, was one such instance where the states had little elbow room. Besides, there were treaties like the Free Trade Agreements, that affected states adversely but they were in no position to alter the situation. For instance, the Free Trade Agreement with Sri Lanka had affected cash crops with Kerala, he said.

In the note that has now gone to the PM, the CPI(M) has said that the NDC should have the final say on food pricing, procurement and distribution. Appointments to constitutional bodies like the Finance Commission should be made by the President on the recommendations of the inter-state council and not of the Centre alone.

The party has also commented on the search for foreign investments by state governments, saying as states compete to attract private and foreign capital, they tend to make “ever larger concessions to such capital” which reduces their bargaining strength.

“The NDC must work out guidelines within which the states seek to attract private investment,” the CPI(M) said. Talking to mediapersons, Karat advocated greater state intervention in key sectors, higher investments by the PSEs since they also had a bearing on private investment, scrapping of the FRBM Act and a shift from the “obsession with fiscal deficit”, an accent on food security and greater manoeuvrability for states on economic issues.

On the suggestion made by the Planning Commission on shifting the pattern of employment away from agriculture by increasing non-agriculture employment, there is no concrete strategy on doing this apart from saying such a shift would happen through higher growth in manufacturing and service sectors.

On public investments, the party says many PSEs hold their profits as reserves or provide savings for use by the government or the private sector instead of engaging in active expansion and investment. But they must undertake massive capital expenditure and diversify their activities if necessary, says the CPI(M).