Economy

India's Resource Crunch Provides Compelling Reasons for Dropping Wasteful Projects 

If austerity measures are to be enforced, a good place to start would be some of the more controversial Centre and state projects.

The COVID-19 outbreak and the long lockout which followed has created extremely serious disruptions for India’s economy including a severe resource crunch, a situation that looks even more dire in the context of state government finances.

At a time when serious problems of hunger, disease and loss of livelihoods require greater financial resources to help tens of millions of vulnerable people, governments are experiencing a serious shortage of resources. At the same time, it is important to emphasize that there are several ways in which these resources can be found. While on the one hand, there are ways of raising more resources, on the other there are ways of curbing existing wasteful expenditures.

In recent years, several controversial projects involving the union government or various state governments ( or both) have been widely debated on the ground that these are highly wasteful, in terms of committing a lot of resources for non-essential, avoidable or dubious  objectives. There are also several projects which have been criticized widely for their very adverse social and ecological impacts and hazards. Some of these projects involve very large-scale displacement of people, including a disproportionate share of tribal and hill-region people in sensitive parts of the country. In some other projects direct or immediate displacement may not be so high but they involve longer and medium term ecological disruption and hazards which will ultimately be very harmful for people as well.

If these projects are dropped then very huge funds committed over the next few years can be saved and diverted to tens of thousands of  small-scale works of economic and ecological rehabilitation in villages, small towns and cities which will give direct and immediate livelihoods and income to needy people which will be many times higher than the gigantic, capital-intensive, machinery-intensive, longer-gestation projects of uncertain benefits and more certain harm. 

The Central Vista project in New Delhi has been widely criticized as a highly wasteful, non-essential and best-to-avoid project. If the union government takes a lead in giving up this project and diverting its resources to several small schemes for helping the poorest urban households over the next few years, it will fulfill a badly felt and highly accentuated need for schemes which more directly and immediately help the urban poor. If the Union government cancels the Central Vista project just now, it will set an important example before all the state governments that in this hour of very compelling need to help poor and vulnerable sections, the authorities should be willing to drop even the most highly favored projects in order to find the necessary resources for helping the weaker sections and restoring their livelihoods and income. This is by no means an isolated example of projects devoted more to distorted notions of grandeur than real need. At least for the time being all such grandeur-oriented  projects should be dropped in favor of need-based work and schemes.

There are several projects described as ecological and social disasters by careful researchers but nevertheless billions of Rs. have not only been committed to them  but in addition billions of rupees further will be gobbled by them unless these are stopped. The reason is that these are seen as parts  of a much wider and longer-term project.

The River-Links scheme starting with Ken-Betwa link is one such scheme whose basic ecological sanity has been very seriously questioned by very senior experts but which goes on getting extension and expansion. Apart from its huge social and ecological costs, financially also this is going to impose a huge burden in the coming years. Stopping this will make available huge resources for small water conservation projects which will bring immediate income ( in terms of wages) and irrigation and water conservation benefits to a very large number of villages. A similar case can be made for stopping other large dam projects which involve high costs of displacement and/or ecological /safety disruption, and diverting these funds to small-scale, decentralized  river-protection and water-conservation projects. For example attempts to rejuvenate many drying small rivers and streams can be made by afforestation and catchment protection works.

In the transport sector costly, prestige projects such as bullet trains could be stopped. Those highway widening, expansion or new construction projects which involve very large-scale tree felling should be stopped and alternatives can be explored in due course. This is particularly important for the Himalayan highway projects which have destroyed many roadside villages and forests. The Himalayan region  is in the middle of some very costly highway projects involving axing of thousands and thousands of trees in ecologically very sensitive areas ( including even Ganga river Himalayan catchment areas ) and inflicting immense damage on the sustainable livelihoods, even survival , of several villagers. This entire destructive process needs to be reviewed and checked, alternatives explored. In the process huge funds can be saved and diverted to meet the pressing livelihood and basic needs of people.

Any scheme which involves large-scale displacement, large-scale felling of trees and threats to natural forests or serious hazards needs to be reviewed, stopped at least temporarily for review period and alternatives explored while meanwhile funds can be diverted to meeting the immediate urgent needs of people.

In some backward areas of large-scale poverty this can make a huge and much-needed saving for diversion to needy and vulnerable people, In Bundelkhand region, for instance, huge funds can be saved by cancelling projects like Ken-Betwa link and Expressway , in the process saving a very large number of trees, avoiding a lot of displacement and at the same time making available billions of Rs. for families of farmers and migrant workers/ landless people who have faced a lot  of distress in recent times.

Apart from dropping or reviewing or putting on hold wasteful and controversial projects, in its day-to-day functioning also the government can curb several wasteful expenditures.

Of course curbing wasteful expenditure is only one of several options. Other options such as raising more resources for helping the poor also are very important at the level of fiscal policy.

Bharat Dogra is a freelance journalist who has been involved with several social movements.