Chacha's Ministers - In Error

While our great and illustrious prime minister’s leadership qualities are very much in doubt, two of his important ministerial colleagues are also up to no good. I am referring to Anand Sharma, cabinet minister for commerce and foreign trade, and Shashi Tharoor, junior minister for foreign affairs. Let us begin with Sharma, who replaced Kamal D Nutt some time ago.

A news report says that Sharma’s ministry has just sanctioned 500 crore rupees on export subsidies – after spending 1500 crores this fiscal year on that head already. The logic seems to be blatantly “mercantilistic” – the doctrine that exports are “good” for an economy while imports are “bad.” Exports increase earnings while in the case of imports money flows out. It is not seen that when money flows out, goods flow in – goods that are usually not available domestically.

This is why the mercantilists of old lambasted the Honourable East India Company – for they were exporting gold while importing spices. These spices were not necessities; they were luxuries and fripperies, and the mercantilists felt England was losing wealth in these deals.

It was Adam Smith, no friend of the EIC, who first exploded the myths of mercantilism. He showed, in the Wealth of Nations, that a nation’s wealth is not its stock of gold bullion; rather, national wealth is the sum total of the consumption, possessions and properties of the people. Thus, cheap imports increased national wealth.

It is best to look at the issue from the viewpoint of a village economy, the kind in which I now live in southern Goa. Here, there are but a few shops, and all the goods they stock and sell come from the world outside our village – they are “imports.” Do these imports damage the village economy, or are they the most important sources of material advancement for all the villagers? Indeed, the villagers flock to these few shops every day, to buy the things they need. They could not survive without these imports. Like wheat, which does not grow in these parts. Or textiles. Or whatever. Without these imports, we all would just be living off fish, rice and coconuts – and feni, of course.

Thus, as in the case of Kamal D Nutt, who stridently opposed imports and championed exports, wrecking WTO negotiations in the bargain, so too with Anand Sharma – they are mercantilists. Since Sharma is a lightweight politician with an important portfolio (as is Chacha) it must be presumed that mercantilism is basic to CONgress ideology. Like all their other policy preferences, from NREGA to “right to education, to the proposed “right to food,” these are all avenues by which CONgress con artists steal public money from the treasury.

Export subsidies are theft. If a manufacturer cannot sell abroad in free competition, nor locally, he should shut down and change his business. The impoverished masses cannot be asked to pay for his business to “succeed.”

On the other hand, cheap Chinese toys are good for the poor Indian (and his children), just as imported mobile phones and cars are good for all of us. May we import wines and cheeses, too. Indeed, may India become the world’s largest duty-free trading area. They used to say “Fly, Buy, Dubai.” May the world soon say “Fly, Buy, India.” That is the India we must bring about – by rejecting Chacha’s mercantilism.

I recommend this Mint editorial of today that is critical of those Indian firms who demand protection from Chinese imports.

Onwards to Shashi Tharoor.

I believe ministers must WORK. Tharoor just “tweets” – whatever that is. And he courts controversy and thereby hogs media attention – undeservedly. What work should be assigned to the junior minister for foreign affairs?

Tharoor is an old UN hand – and the UN is the world’s largest bureaucracy. Similarly, the foreign affairs ministry’s biggest bureaucracy is the passport office – and it is a mess. Ask me, for I am having a great deal of trouble getting my valid passport renewed, to the extent that the documents the passport office is demanding are not even required as per their website – as, for example, an “address proof” when the old address has not changed. I think quick and easy passports are very important in this globalized world – and Tharoor would do the nation great service by using his bureaucratic prowess to streamline this department. Let him be judged by his work, rather than his silly tweets.