Professor Stiglitz's Criticism of Government of India

Samirnath Mallik

In a recent seminar on the web organised by the FICCI eastern India Chairman Rudra Chatterjee, the well-known economist Nobel laureate Professor Joseph E. Stiglitz of Columbia University has criticized the Indian Government on different fronts.

Here I discuss his criticism on the poverty of people in pandemic crisis. He said that India has a good population of billionaires and millionaires and the Centre can increase taxes on them for two years and spend the extra money so obtained for the poor.

Here Professor Stiglitz refers to the corporate tax of the different business houses. During 2019-2020 the corporate tax collected by the union government was about Rs. 6 lakh crore with tax rate at 25 per cent. Increasing this rate by only 4 per cent say, the Government could collect an additional amount of about Rs. 1 lakh crore.

Out of about 133 crore people in total, about 10 crores is estimated to be below poverty level (earning less than Rs. 100). Let us take another 10-crore coming below poverty level due to pandemic crisis. For this 20-crore people the government could the increase per capita income by an amount of Rs. 5 thousand with this additional Rs. 1 lakh crore generated
by increasing  the corporate tax by only 4 per cent, as calculated above. For a family of 4 members this would amount to Rs. 20 thousand per year.

This increase in income of 20 crore people for two years would bring significant money in the market, causing all sorts of essential industries to flourish. It would also create new job positions for the people, on which the economy would thrive. As a result, the Indian population below poverty level would shrink enormously. This is the purport of the suggestion of Professor Stiglitz on the Indian economic front.

Unfortunately the so-called 'democratic' government is indirectly influenced by the same billionaire and millionaire business houses whose corporate tax Professor Stiglitz suggests to increase and distribute the  additional amount thus acquired among the people below the poverty level. So, they would not allow the Centre to impose this extra tax on them. This is the sad tale of poverty  in India.

Frontier
Oct 31, 2020