Its Tory time at 10 Downing

Yippee, there is a change in 10 Downing Street. After 13 years of “New” Labour, the Tories have got a chance to resurrect Britain. They have stitched up an alliance with Nick Clegg’s Lib Dems who have agreed to be a part of the coalition. Nick Clegg would be the deputy to David Cameron, 43, who is all set to become the youngest PM in over 200 years. Though there are ideological and practical differences between Lib Dems and the Conservatives, Clegg has asked his supporters to be optimistic and I cant imagine any other way out for him. He has serious differences with the Conservatives on cutting Government spending, Electoral reforms to scrap the “First past-the-post” system among other things, BUT seems to have got a good deal from the Conservatives.

As per BBC reports, the salient features of the deal are as follows:

• Plans for five-year, fixed-term parliaments
• The Lib Dems have agreed to drop plans for a “mansion tax”, while the Conservatives have ditched their pledge to raise the inheritance tax threshold to £1m
• The new administration will scrap Labour’s planned rise in National Insurance but some of the benefits will go on reducing income tax thresholds for lower earners
• A pledge to have a referendum on any further transfer of powers to the EU and a commitment from the Lib Dems not to adopt the euro for the lifetime of the next Parliament
• The Lib Dems have agreed to Tory proposals for a cap on non-EU migration
• The Conservatives will recognise marriage in the tax system – Lib Dems will abstain in Commons vote
• The Lib Dems will drop opposition to replacement for Britain’s Trident nuclear missiles but the programme will be scrutinised for value for money
• There will be a “significant acceleration” of efforts to reduce the budget deficit – including £6bn of spending reductions this year
• There will be a referendum on moving to the Alternative Vote system and enhanced “pupil premium” for deprived children as Lib Dems demanded

The last point is very important for the Lib Dems and they hope to see some action in the area of electoral reforms. Though I have my doubts regarding the longevity of this coalition, I wish the new PM and his team the very best as they faces serious challenges in the areas of Fiscal Consolidation, Britain’s Economic Growth and the crises in Euro zone. Hope they do well and regain the trust of Britain’s people.

P.S: Personally, I am happy because after a long time a party that I support has got the right results in an election Well, a majority would have been good but then…

The three questions for BJP!

Here, Rajesh Jain asks 3 questions whose answers would help the BJP charter a future course. I have provided my inputs on his blog and am now replicating those in this blog post.

1. What are the 2-3 big issues that will present the most challenges and opportunities for India?

(a) Scaling up infrastructure in the areas of Health, Education, Power sector and mass transportation would present a huge challenge in India.

(b) The large number of people working in unorganized sectors would hamper reforms in the labour sector and rationalizing taxes. India also needs to address the imbalances in its workforce. For example 50% people working in agriculture account for only 17% of the GDP while 34% of workforce working the services sector account for a much larger 60% of the GDP. This issue has to be addressed while keeping the supply side in agriculture sector strong ensuring self sufficiency and lower food prices.

(c) India’s foreign policy needs to be far more assertive specially vis-a-vis Asia. It is time India asserted itself as a regional superpower by having far more meaningful relations with Indonesia, Vietnam, Malaysia and other South East Asian countries which are culturally closer to India. Japan and South Korea would also be natural partners. They could manufacture their goods in India which could be shipped to South East Asia. This would also keep China on its toes.

Which ideas/issues would resonate most with the youth in this decade — those issues which will fire them up to actively work towards their own and India’s development?

(a) Establish numerous tie-ups with reputed educational institutions overseas to offer quality courses across different areas (Engineering, arts, medicine, economics) in India with emphasis on R&D. This should make the issue of reservations in Education irrelevant. Also this would ensure Indian talent stays on shore. Promoting entrepreneurship would enable the youth to be more aspirational and help in nation building by offering indigenous solutions.

(b) High quality Government services which are hassle free and devoid of red-tapism and corruption. This could also be debated in the context of privatization and disinvestment.

Which matters should we focus on in the next 10 years? These should be achievable and must be important for India’s development?

(a) Promoting an aspirational society while promoting the values of nationalism, liberty and kindness. Putting it in the other way, the discourse has to be turned away from the concepts of “Aam Aadmi” and “masses” to “Khaas Aadmi” meaning individuals in society can have a dream and work towards scaling it unrestricted.

(b) Social sector schemes/cons like loan waivers and NREGA have to repackaged to add economic value to the system. This would give a lever to tackle inflation as well because we are not pumping money into a project which adds nothing making the money worthless.