india

Updated: Sep 28, 2019 00:49 IST

The Bharatiya Mazdoor Sangh (BMS), the labour wing of the Rashtriya Swayamsevak Sangh (RSS), has warned the government that the economy will take a turn for the worse unless it comes up with special packages to boost farming and small and medium manufacturers, and halts planned bank mergers, disinvestment and strategic sale of public sector units.

While the Narendra Modi government has described the slowdown, which pushed economic growth down to an over six-year low of 5% in the quarter to June, as a cyclical process, the Opposition has blamed its economic policies for the downturn evidenced by high-frequency indicators such as auto sales.

Former Prime Minister Manmohan Singh said in August that the state of the economy was deeply worrying and although India has the potential to grow much faster, all-round mismanagement by the government had resulted in this slowdown.

Now the BMS, which claims to represent more than 6,000 registered trade unions and boasts of a membership of 30 million, has also sounded the alarm.

“If we don’t take actions now, we will soon be back at the Manmohan line. It was the time between 2012-13 when the growth rate hovered between4.8% and 5%. The government’s reliance on failed advisors has resulted in lowering of growth figures. Instead of foreign-returned experts in NITI Aayog, the government needs to consult organisations at the ground level to draft policy,” said Saji Narayanan, national president of BMS.

The compound annual growth rate of gross domestic product during the Congress-led United Progressive Alliance’s first term (2004-05 to 2008-09), second term (2009-10 to 2013-14) and the Modi government’s first term (2014-15 to 2018-19) was 6.7%, 6.4% and 7.5%, respectively.

In an interview with HT, Narayanan said the government needs to announce a special package for the revival of labour-intensive sectors such as textiles, agriculture and micro, small and medium enterprises (MSMEs).

“There is a trend to move towards contractual appointments even in the government sector; jobs are shrinking, so there should be urgent steps to give a boost to the MSMEs instead of opening up FDI {foreign direct investment},” Narayanan said.

The BMS leader said sops such as payment of Rs 6,000 annually to farmers under the PM-KISAN scheme were stopgap measures that had been announced in response to extreme farm distress.

“Farming needs to be profitable and self-sufficient. Rs 6,000 a year will not do that, nor will loan melas help small entrepreneurs. The first step is to halt FDI and follow the protectionism model that counties like China and the United States have to protect their domestic manufacturers,” he said.

The BMS, which is currently carrying out awareness drives about the fallout of disinvestment and strategic sales, will organise a national convention on November 15 to draw up an action plan for saving public sector units.

“From an economy that withstood the global crisis of 2008, we have emerged as a failed model; what we need is an India-centric model that has people at the centre,” he said.

To be sure, other labour unions too have warned against measures such as bank mergers, disinvestment and strategic sales of state-run companies which they are concerned will lead to job losses.

The government has announced plans to combine 10 state-run banks into four, raise around Rs 1 lakh crore from disinvestment this fiscal year and formed a group of ministers to explore a strategic stake sale in Air India.