2G scam loss and the economy

(This comment is in response to the editorial'Telecom Turbulance' appeared in The Hindu-Business Line)

The fact that the Finance Ministry has failed to exercise its due vigilance on the proposal of the Telecom Ministry to jettison the auction procedure and adopt first come first served has led to the loss of the exchequer in crores of rupees needs an explanation from the Govt.This sort of leakage of revenue due to malpractices and lack of concern for managing public finance efficiently leads to avoidable deficit and consequent damages to the economy which has been facing problems one after another for want of resources.The failure of these Ministries should be viewed as the failure of the Govt as the damage caused to the economy is irreparable.Inflation remains unchallenged since 2009 and the basic reason is failure of fiscal policy and definitely not due to ineffectiveness of monetary policy.Easy money in the hands of a few due to failure of policies has adverse moral,ethical and financial impact in the economy. The confidence is shaken among public and the economy suffers.

T.V.Gopalakrishnan

( This appeared in The Hindu Business Line Dt,1/10/11)