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This is an archive article published on September 26, 2004

‘It is not uncommon in democracy for two people to run govt and party’

• Despite having large coffers of foreign exchange, why doesn’t India go in for full convertibility of the rupee?Sushil Mehra Alth...

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Despite having large coffers of foreign exchange, why doesn’t India go in for full convertibility of the rupee?
Sushil Mehra

Although our foreign reserves appear to be comfortable, a large portion of these reserves are in the form of NRI deposits and investment by FIIs. This money tends to fly out at the first sign of trouble. We have the bitter experience of East Asian economies. What we need is a more robust trade account and large inflows of FDI. This will need a more aggressive export drive and removal of difficulties in attracting FDI. We also need to reduce our revenue deficit, for which we have set annual targets. We do have a well-calibrated road map for achieving full convertibility of the rupee, but considering the East Asian contagion, we have to be cautious.

What is the frequency of interaction between the PMO and 10 Janpath? If it were to be institutionalised, what would be the level?
Madhur Srivastava

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The Congress party contested the elections under the leadership of Mrs Sonia Gandhi, and the people of the country gave their mandate to her. She decided to nominate Dr Manmohan Singh to run the Government while she would run the Congress party. It is not uncommon in a parliamentary democracy to have two people running the Government and party.

Mrs Sonia Gandhi is the Chairperson of the UPA, and the Coordination Committee of the UPA set the broad policy agenda, including the Common Minimum Programme, for the Government. It is the charter of governance which will be implemented by the Government. Mrs Gandhi is also the Chairperson of the National Advisory Council formed to advise the Government on implementing the CMP, and specifically to provide a grassroots perspective. The Congress president and the Prime Minister meet regularly for better cohesion.

The Left parties seem to be the Achilles heel of the UPA Government. Do you see any compromise or will the issue continue to drag on like this?
Arup Roy

The support of the Left parties is essential for the UPA Government. All the parties in the coalition have agreed to abide by the CMP. While we share a common political, social and economic ethos, we had our own manifestoes during the elections, and there are some differences in details and priorities to achieve the agreed programmes in the CMP. These differences are sorted out with discussion. We have a structured platform for dialogue with our Left parties.

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Inflation is still high and can be a serious political issue. What steps is the PM taking to control it?
Smita Gupta

The rate of inflation has marginally gone up to 7.87 per cent from 7.81 per cent in the last two weeks. It has been predominantly fuelled by an unprecedented rise in international prices of crude oil, an erratic monsoon and an increase in the international prices for steel. The Government is committed to controlling inflationary pressures, and has reduced import duties on crude oil, steel and metal scrap, and edible oil. The RBI has hiked the Cash Reserve Ratio (CRR) to absorb excess liquidity in the system. The Cabinet Committee on Prices constantly monitors the prices and whenever warranted, the Government acts decisively. We are confident that prices will get stabilised soon. We will also not hesitate in taking any steps to curb the inflationary tendencies and pressure on prices.

The Congress is contesting the lowest-ever number of assembly seats in Maharashtra. Are you setting the stage for eventual marginalisation of your party in the state?
Rahul Bhandarkar

The Congress has gone in for a pre-poll alliance with the NCP, as during the Lok Sabha elections. As a result of that alliance, we increased our respective seats in the LS elections, and the same will happen during the Assembly elections. The NCP is an off-shoot of the Congress party and shares the same political ideology. The NCP is a part of our coalition government both in Delhi and in Maharashtra. One cannot rule out eventual merger of the NCP with the Congress in the near future.

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You have removed only some of the RSS men holding gubernatorial assignments and not the whole lot. Is Madan Lal Khurana less of an RSS man than Kidar Nath Sahni?
Mukesh Sharma

The appointment of Governors is the prerogative of the Government as per the Constitution of India. Accordingly, the Government has appointed governors wherever it has felt the need to do so.

There is a belief that the far-Left insurgents, active in Andhra Pradesh besides many other states, may utilise the current ceasefire to consolidate. Does you strategy take this possibility into view?
Nalin Rao

The UPA Government is committed to having a dialogue with all sections of the society. We are willing to address the issues of Naxalism and other far-Left insurgents. There is a broad consensus that it is not merely a law and order problem but has to be addressed on political, economic and security fronts. While we would concentrate on the development agenda, we will also ensure that the security and integrity of the country is not compromised under any circumstances.

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