- Fiscal democracy refers to the freedom available to the government to spend and tax.In the present economic situations very little is left to decide in the present because much has already been decided in the past.
- Since fiscal democracy is essentially about the flexibility of fiscal resources, it is possible to measure it by the proportion of tax revenue that is not needed to coverobligations entered into in the past.
Yes there is a gap between India’s political and fiscal democracy :-
- The recent Economic Survey has highlighted this.For instance it shows that in Norway, for every 100 voters, there are 100 taxpayers. In India for every 100 voters, there have been only seven taxpayers.
- The minimum threshold below which no income tax is paid is Rs2.5 lakh. This is 250% of India’s per capita gross domestic product (GDP). That makes India one of the most generous exemptors in the world
- In most countries, income tax becomes payable when your income is about one-half or one-fourth of the average income in your country. Indeed, in Russia, you pay income tax from the very first rouble that you earn.
- This tax-paying class is so vociferous and politically active that the exemption slabs keep creeping up every year.
- India achieved political democracy by Universal adult suffrage ,Fundamental rights, Independent judiciary but there is lack of fiscal democracy as seen in the following:-
- Lack of fiscal jurisprudence:-Government utilises public funds for fulfilling short term goals, populist measures etc and doesn’t go for capital asset building and long term benefits
- Tussle between Centre and states over revenue share:-.
- Lack of devolution of funds at the lowest level like Panchayats.
- Unspent Fund:- Funds allotted to various government departments for welfare remained unspent due to lax attitude of political leadership and officials.
- Fiscal deficit:- India always remained a fiscal deficit nation it shows the govt functions on borrowing which in turn reflects towards debtness of the future generations.
- Lack of proper financial inclusion.
- Populist measures such as lower taxes and more exemptions also lead to reduced revenues, hampering fiscal democracy.
By reducing fiscal deficit,Replacing FRBM act with a debt ceiling and fiscal responsibility legislation fiscal democracy can be achieved.Integrated market under GST, simplified and predictable tax structure, GAAR, incentivising tax payments, can go a long way to promote fiscal democracy.
Demonetisation changed the earlier view about fiscal constraints and with this measure the government had the freedom to bring in latest initiatives to make India cashless.
- India is one of the largest agriculture markets in the world today, with index-based crop insurance covering a wide variety of crops in major provinces of the country.
- Still, there has been low penetration of agriculture insurance in India, with challenges like insufficient risk coverage, delayed and inaccurate claim assessment, and leakage.
Agriculture insurance is important because eof the following reasons:-
- Food security in India is dependent on success of agriculture due to which it is important
- Agriculture is the biggest employment provider due to which its success is important . Farming is the backbone of rural economy. with such insurance farmers can invest in other non-agricultural activities like fishery and dairy products. This can lead to increase in in the GDP and overall growth of the nation
- Agriculture controls inflation of important commodities through production keeping food basket within peoples range
- Indian practices are dependent on monsoon rains due to lack of irrigation projects therefore probability of agriculture failure is higher
- Technology with respect to fertilizers, pesticides and mechanized farming are also not used which can lead to crop failure
- Lack of support from Disaster Management Teams with respect to cyclones, earthquakes and forest fires which affect agriculture.
- Such insurance helps farmers to take necessary risks, afford loans and keep away from debt traps that most of the time results in distress and suicides.
- Once the farmer is insured he/she can make arrangements for next cropping in case of crop failure and keeps food market stable and does not leads to inflation in food prices in case of bad monsoon or false rumors.
However the penetration of insurance is low due to following reasons –
- Lack of reach of financial institutions in the remote corners of country
- Less penetration of banking system in the rural background.
- Costly schemes due to unpredictable monsoon and no information with respect to climate changes and natural disasters due to lack of technology support
- Fiscal illiteracy:
- Farmers in general are not educated and lack basic understanding of credit mechanism.
- Insufficient risk coverage, delayed and inaccurate claim assessment, and leakages.
- Lack of incentive for insurance companies for structuring schemes for the rural areas.
Due to the above reasons the penetration of insurance is low in the rural areas . Therefore it should be tackled with needed policy implementations like PMFBY which will prove interest subsidy to develop insurance market, attract new companies in rural India and promote then to use innovative techniques like Geo mapping or LIDAR for land assessment.
- Liberty is respected by the world and it is this which gives people freedom to do what they want to do.
- According to Plato, Self control means controlling inferior soul by superior soul of the person. Without this self control, there will be excess of liberty which will lead to inferior virtues of greed, indolence, carelessness taking over superior virtues of discipline, sincerity and empathy . Hence, a person becomes slave of immorality.
- However “Lliberty runs rampant” can be framed like this: Imagine that there are no rules of the road, no driving lanes, no set direction for traffic to take.
- If there are no rules and everyone can drive however they want, the road might become very chaotic and dangerous. This chaos, as a norm, would keep many people from driving. Driving would be too dangerous. In this case, the freedom to drive is nullified by the danger of driving.
- The excessive liberty, in this case, would become a clear danger to life, making people slaves to a certain chaos.
- This may create problems of control and dependency and create slavery like situation. When there is excess of liberty some people might get addicted to alcohol,drugs etc which can make these people get addicted to these and become slaves .
- Environmental problem :- During the industrial age, people had excess liberty to use natural resources. So, human made nature slave. Now the devastating result is in form of Global warming.
- Green revolution encouraged tube irrigation resulting in excessive ground water recharge. This deteriorated soil health and made farmers dependent on fertilizers.
- Excessive agricultural rights and abdication of environmental duties lead to modern form of slavery and dependence.
- Similarly if government is free to decide on all developmental projects, all policies and all laws without taking view of public and checking ground realities, will impinge on rights of people and create problems of displacement, farmer suicide, freedom of speech etc.
- Excess of liberty available to politicians has resulted in the nation being enslaved by corruption
However, liberty is important for establishing free society.Any restriction hampers the progress of the society
- Liberty has to be balanced with tolerance and awareness of duties. In western society authors are given liberty and people are also tolerant towards rights of others. Hence there are less protest and agitations.
- Similarly excessive liberty of thought can break the chain of ignorance and inequality like Copernicus educated the world that universe is sun centric, Dr. Ambedkar fought for the right of Dalits and downtrodden.
- some liberty is necessary at every level for good and effective decision making process, for effective implementation of policy and to spend a free life.
- . Free society is important for growth of art, culture, science and promote new innovations by braking the shackles of orthodoxy.