Satabdi Gantait

‘I Am Thankful To RBI, Govt For Revival Of Yes Bank Ops’

Satabdi Gantait had her salary account and Fixed Deposit in Yes Bank. She recounts the initial panic and the relief after the bank resumed normal operations

I can’t tell you how relieved I am after knowing that Yes Bank is operational again, thanks to timely intervention by the RBI and Centre government. I have my salary account in Yes Bank and when the news of Yes Bank collapse came, about a fortnight ago, many of us didn’t know what to do. I also had Fixed Deposits (FD) in the bank so I was doubly worried as to what fate my savings has in store.

Given that it was the beginning of the month, I was supposed to make payments to several people as well. It was chaos. Thankfully, I had another account in a different bank but it is horrifying to think about those who had all their savings in Yes Bank.

ALSO READ: Yes Bank Debacle And Crony Capitalism

I myself had been following news about the economy and various banks on and off, but in these times when there is so much of information flowing in all the time, one doesn’t know whom to trust and whom not to. Also, many a times one isn’t completely aware of what a particular step from the government means. We are dependent on news channels to decode information for us.

Following the news of Yes Bank collapse, the UPI (an online payment interface) on my phone stopped functioning. I teach interior designing to students in Kolkata and fashion is an industry where large amount of money exchanges take place. So undoubtedly there was panic in our group.

Thankfully, Union Finance Minister Nirmala Sitharaman came out and assured ordinary people depositors that their money was safe. That people didn’t need to panic and that the government was doing all it can to rectify the situation as quickly as possible. This was reassuring but we kept our fingers crossed. I wonder why we need to reach a situation like the Yes Bank one in the first place that ordinary people begin to panic!

ALSO READ: Centre Clears Plan To Salvage Yes Bank

I suffered during demonetisation as well and for a moment (at the beginning of the crisis around 15 days ago) I thought 2016 was going to play itself out once again in 2020.

I run an interior design firm and had to make and receive large amount of money. Both depositing and withdrawing money had become extremely difficult back then. Thankfully this time things are different.  I hope no more banks reach such a state, so that ordinary people don’t worry whether they will be able to withdraw and use their own hard-earned money.

‘Nirmala Ji Doesn’t Inspire Confidence Among Middle Class’

Bhaskar Rashmi Pandey, a 38-year-old homemaker in Delhi-NCR, says a middle income household can draw little comfort from the mumbo-jumbo of Union Budget 2020

I was a working woman till 2013, after which I decided to quit work and focus on bringing up my two children. Thus, mine is a single-income household. I run a six-member family and I must say that my household budget has shot up big time ever since this government came to power in 2014.

Under previous governments, the price of daily-use items did go up, but they were brought under control immediately. With this government prices have been moving only upward. Take onions, a basic commodity for every kitchen, for example, remained above ₹80 for nearly two months. There was no effort from relevant ministry to bring the prices under control.

The budget (Budget FY 2020) just unveiled by the government doesn’t give me much confidence. The government says it wants people to have more disposable income in their hands with the new proposed budget regime, but it’s like ek kadam aage, do kadam peeche (one step forward, two backward). There might be more income in hand, but what use is it if the prices of products keep increasing? It is like back to square one.

ALSO READ: Union Budget 2020 – A Missed Opportunity

In our household, we have two growing children and their nutrition is paramount. So milk, vegetables and fruits are a must buy. The prices of vegetables and fruits have shot up the most. In our household we had to increase the budget for these by ₹1000- ₹1500 every month, now totalling nearly ₹4,500, and I wonder how other families with insufficient or a fixed income might be managing their household?

We have completely stopped eating out at restaurants. Earlier we would go out twice a month, now we do that once in two months.

Also, people are in a dilemma regarding this government’s every move, precisely because they are so unpredictable. Earlier housewives used to save money for rainy days but demonetization laid many women’s savings to waste.

Even though many people are praising the move that the government has increased the bank deposit insurance from ₹1 lakh to ₹5 lakh in the FY 2020 budget, I wonder why people are forgetting just how many banks are literally on the verge of collapse. For all your investment, you are going to get ₹5 lakhs at the max(imum). Since 2017, there have been so many instances where people have not been able to withdraw their hard-earned money or a limit has been put on withdrawal.

WATCH: Nothing In Budget To Check Inflation

With the condition that the universities are in today what with sudden violence and protests breaking out, we wonder how our savings for our kids’ education (a major portion of any family’s budget) will end up. In addition, even after spending on our children education, will there be enough jobs for them to earn a comfortable life? I wonder why the government isn’t taking cognizance of the unemployment in the country. The youth needs to be productive if we don’t want them engaging in anti-social activities.

Only a good budget, not the mere impression of a good budget, can lead to peaceful times. Frankly, our Finance Minister Nirmala Sitharaman Ji doesn’t inspire much confidence. Being a woman she should understand that there are many expenditures in an average family, and that this budget has increased the price of many household items.

My husband who works at a senior position in the lamination industry laments the fact that the government isn’t paying sharp attention to how the economy is functioning and is busy solving surface issues rather than looking at the deeper, bigger issues. I totally second him. Our average monthly expenditure has gone up to about a lakh, and I am sure other middle-class women are finding it increasingly difficult to manage.

Union Budget 2020: A Missed Opportunity To Tackle Unemployment

Continued lack of employment opportunities for India’s youth has already led to disaffection among them and that is evident partly from the manner in which student unrest (albeit triggered by the Modi regime’s controversial Citizenship Amendment Act) has spread. Half of India’s 1.3 billion people are below the age of 25. This year, it is expected that the average age of an Indian will be 29 years (for China, it will be 37). As education levels rise for young Indians so do their aspiration for good jobs and better standard of living. If employment rates don’t rise their hopes will not be met.

That could be a ticking time bomb. Many believe the countdown to an explosion has already begun. Educated urban youth in India have readily joined the movement against the Citizenship Act, which is being seen as discriminating against the largest minority community in India, Muslims, who constitute more than 14% of Indians. The youth’s opposition to the Act must be seen holistically. It is a symptom of the greater disaffection that young Indians feel. Even as the number of those who graduate from schools and colleges increases, their prospects of landing desirable jobs have diminished. Before long this could be a problem instead of the demographic dividend that a youthful India could benefit from.

In that context, Finance Minister Nirmala Sitharaman’s Budget has missed a big opportunity. The annual Budget in India has always been a mega economic event in the country. Finance ministers, regardless of which political party they represent, use the exercise, which ought to be a routine balancing of the government’s expenditure and revenue streams, not only as an opportunity to announce the government’s economic policies but also as a podium to offer sops and incentives to different sections of the population—an exercise that is seen as a means to garner electoral support from voters.

ALSO WATCH: Youth Slam Govt Over Lack Of Jobs

As a consequence, the media hype gets heightened and the Budget’s announcement in Parliament becomes a red-letter day for newspapers, TV channels and other publications. In recent years, as the Indian economy has become less regulated; tax structures have become simplified; and government controls on different economic sectors have loosened, the Budget’s importance has declined. It is no longer an event that offers governments a chance for grandstanding or making big announcements for changing policies or ushering in new economic strategies.

The Indian economy has been ailing in recent months. It is probably at the worst low point that has been witnessed in over a decade. Last year, GDP growth rate slumped to 4.8% from 2018’s 6.8%; prices across many categories of products, including food, rose; and sales of consumer products stagnated. Industries, including automobiles, white goods, and other categories held off investment plans as inventories of unsold products built up. The youth—65% of Indians are under 35—were impacted adversely too as estimates of the unemployment rate rose to nearly 8% at the end of 2019.

ALSO WATCH: Nothing In This Budget To Create Jobs

In her Budget, Sitharaman announced a series of incentives—personal income tax cuts; bank deposit insurance; and some infrastructure investments—but none of them were designed specifically to increase the potential for generating more employment. Most of India’s youth are based in rural parts of the country. Nearly 66% of Indians live in villages. And while 44% of Indians are employed in agriculture, the sector accounts for a shade over 15% of GDP. Labour productivity in the sector is low and many Indians are what economists call “disguised unemployed”—that is they work on farms but don’t add anything in terms of incremental output.

In fact, it has been argued that if rural youth, ostensibly working on overcrowded farms, get the opportunity to move to other sectors and find work, the productivity of Indian farms could actually go up. But there lies the rub. Where are those alternative jobs? India’s Prime Minister, Mr Narendra Modi, and some of his ministerial colleagues have often stated that India’s youth have opportunities galore in the informal sector—to be small entrepreneurs who are self-employed. Those are facetious statements, designed more to divert attention from the real problem of unemployment than to alleviate it. Otherwise, how does one explain the phenomenon of post graduates and graduates applying in thousands for menial posts such as that of a government department’s peon or a municipality’s sweeper?

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Yet, there may be a kernel of an idea for employment generation in those statements. If the finance minister, in her Budget, had devised incentives for unemployed youth or other budding entrepreneurs to set up small businesses—through liberal grants of seed capital; subsidised land for building small manufacturing or trading establishments; and facilitation for marketing and distribution of products and services—that could lead to heightened entrepreneurial activities. Such incentives, if properly targeted in the rural and semi-urban parts of the country where agriculture or farm-related enterprises could move the rural sector up the value curve, it could see the blooming of millions of tiny, small, and even medium enterprises. In turn each of these enterprises could generate employment—not on a large industrial scale—but in modest numbers. If a tiny enterprise hires even four or five workers, 10,000 of them could hire 50,000 young people. The multiplier effect of such an initiative is easy to conceive.

To be sure, Mr Modi’s government, in its first term (2014-19) flagged off many well-publicised schemes: Skill India, which was aimed at re-skilling young Indians; and Startup India, aimed at handholding and helping entrepreneurs to set up enterprises. None of these has attained the levels of success that were envisaged or promised. If such programmes are conflated into comprehensive opportunities for fresh Indian graduates from schools and colleges and offered to them as they finish their education, particularly in rural and semi-urban India but also in urban areas, they could not only be opportunities for unconventional employment but also serve to build small enterprises by young entrepreneurs that could further employ other young people.

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Some of this is happening informally. But the need of the hour is for India’s government to formalise such activity and make it a widespread movement. The definition of a budget is to balance spending and earning; but in India, budget-making could also be the opportunity for governments to think out of the box and create something that could address what is perhaps the country’s biggest issue—a burgeoning population of young people but a diminishing prospect of finding employment for them. India’s youthful demography is unique. Nowhere in the world are there as many young people as there are in India. The strategy to find opportunities for them has to be equally unique. The Budget for this year offered a platform that could have been used to do just that. Sadly, that opportunity was missed.