Address economic problems plaguing Punjab: KR Lakhanpal, Ranjit Singh Ghuman to politicians

Chandigarh, July 25

Expressing concern over the state’s precarious fiscal health, former Chief Secretary KR Lakhanpal and eminent economist Ranjit Singh Ghuman said, “Punjab has to get out of ‘balle balle, sab wadiya mode’, if the state wants to enter a rapid growth trajectory again. It can’t be business as usual.”

“The Green Revolution, though initially beneficial, tightened the noose around the neck of Punjab. The state failed to translate its benefits into non-agriculture sectors. As the impact of the Green Revolution started waning in 1990s, economic growth started slowing down,” they said.

“We have shifted our priority from development to security after facing a decade of terrorism. This continues till date,” said Ghuman.

Speaking to The Tribune, as part of its digital series, “Decode Punjab”, Lakhanpal and Ghuman added that cutting across party lines, all MPs should plead for getting an economic package from the Central Government.

“The state cannot continue to live on borrowed money. Sooner or later, Punjab has to face the hard Budget option,” said Lakhanpal.

The duo said there was no need of giving 300 units of free power to domestic consumers.

Elaborating on a study he conducted on the skewed power subsidy in the agriculture sector, Ghuman said 81 per cent of the subsidy was being pocketed by large farmers. “A major churning is required to deal with freebies. Around 90 per cent consumers get free electricity in Punjab. The political leadership has to be sensitised that they have to establish Punjab, not their parties by offering freebies.”

“Welfare of the people happens when there is money in the pocket. The funds which government can save through rationaliastion of subsidies can be ploughed back to improve the state’s ageing infrastructure,” said Ghuman. He also recommended that instead of free power, income support can be given to poor farmers.

“What ails Punjab’s economy and its growth is the inability of its ruling class — politicians, bureaucrats and academia — to acknowledge that the economy is sagging. They need to make a roadmap for its revival. There is policy paralysis,” stated the duo, when asked to explain why Punjab’s growth story failed.

Talking about crop diversification, Lakhanpal said it’s a “beautiful word”, but for it to actually happen, the Centre must step in. “There is no blueprint. Shortsighted approaches and remedies will not help. Economic agents respond to incentives and disincentives. If the crop is economically viable for the state’s 45 per cent workforce, only then the farmers will adopt it,” he said.

Asked if the state had been discriminated by the Prime Minister Narendra Modi-led NDA government at the Centre, as alleged by several Punjab-based politicians, Ghuman said the Government of India should respond to Punjab’s failing economy, just as they had responded to Andhra Pradesh and Bihar. “The Centre is not giving us any alms. The federal structure of the country allows for equal distribution of resources to all states,” added Lakhanpal.