'Unfavourable policies causes inflation, exploitation of farmers'


"Recent changes in economic policies led to closure of small businesses resulting in unemployment and exploitation of farmers", said farmer's activist and economist Amitabh Pawde. He was speaking at a symposium organized by Vidarbha Teli Samaj Mahasangh at Sevadal Mahila Mahavidyalaya, Sakkardara on Saturday.According to Pawde, India used to export essential commodities but due to change in fiscal policies, the process has reversed. "Earlier, India used to export edible oil which generated income for farmers.

Now, we are now importing about 60% of edible oil. As a result, India is spending more on importing from other countries thereby leading to inflation," he explained.Giving an insight about inflation, Pawde said, "Inflation results in decrease in people's purchasing capacity. Essential commodities like food grains are also bearing inflated prices. This keeps the condition of farmers unchanged."Explaining the correlation between inflation and unemployment, the activist said, "Import leads to devaluation of Rupee.

Then, the government has to supply more currency into the economy which increases inflation. As the production cost of commodities increase, they become overpriced in the global market and decreases its demand."Pawde informed the gathering about the challenges faced by small companies and how non-performing assets (NPAs) are on a rise in India."Retired deputy governor of the Reserve Bank of India (RBI) KC Chakrabarty has stated that the country has around Rs 24 lakh crores in NPAs which is increasing every year. The union budget is shown as a deficit budget. This year, a deficit of Rs 5.14 lakh crore was observed. This could have been avoided by refraining from giving corporate tax incentives which last year stood at about Rs 6 lakh crores," Pawde stated.About plugging the deficit, Pawde said, "The government then seeks a loan from the World Bank to plug the deficit. The WB then imposes conditions which further devaluates the Rupee and increases inflation even more," he said.


Readers choice: TOP-5 articles of the month by UkrAgroConsult