Strong lessons from Lanka crisis, says govt, brings up freebies, fiscal health of some states

In the meeting, Jaishankar said India, as the immediate neighbour, is naturally worried over the “very serious crisis” in the island-nation. “The reason we took the initiative to request you all to join an all-party meeting was…this is a very serious crisis and what we are seeing in Sri Lanka is in many ways an unprecedented situation… Given the proximity, we naturally worry about the consequences, the spillover it has for us,” he said.

Jaishankar said there have been some “misinformed comparisons” in the context of Sri Lanka and some people have asked whether “such a situation” can take place in India. “The lessons from Sri Lanka are very, very strong. They are of fiscal prudence, responsible governance and that there should not be a culture of freebies,” he said.

Jaishankar’s mention of freebies came days after Prime Minister Narendra Modi accused political opponents of promising freebies in exchange for votes.

Our initiative on PM @narendramodi’s instructions to convene an All Party Leaders’ Meeting on the situation in Sri Lanka was very well received. Thank all leaders and MPs who participated in the discussions. pic.twitter.com/hhlKxnDvjb

— Dr. S. Jaishankar (@DrSJaishankar) July 19, 2022

“Today, in our country, attempts are being made to collect votes by distributing free revdis (sweets),” Modi had said while inaugurating the Bundelkhand Expressway last week. “This revdi culture is very dangerous for development of the country…”

Besides presentation by Foreign Secretary Vinay Kwatra on the crisis in Lanka and assistance extended by New Delhi, there was a presentation by the Economic Affairs Secretary, which led to the protests. The second presentation, Opposition MPs said, made a mention of the debt and fiscal condition of Telangana and Andhra Pradesh.

Several members, including DMK’s T R Baalu and TRS’s K Keshava Rao, objected. The presentation was thereafter stopped midway.

Baalu said they came for a discussion on Lanka, not on the Indian economy.

Former Finance Minister P Chidambaram, who attended the meeting along with Manickam Tagore for the Congress, is also learnt to have said that the discussions should be confined to the Lankan issue.

TMC leader Saugata Roy told The Indian Express: “The government made a presentation explaining the Lankan debt position. They said the condition in Sri Lanka stems from economic collapse. They also gave figures of Indian help rendered to Sri Lanka. I asked why didn’t the government intervene before; how much were we able to help and what more can we do?…. The government said Sri Lanka is a sovereign country and it needs to stabilise the situation, but they are doing the best they can.”

Roy said the Opposition objected when a mention was made about the fiscal condition of states. “They were making the point that the situation in Sri Lanka came about because of lack of fiscal prudence. Some states also have..they mentioned Telangana and Andhra. We objected to it…(asked government to) make a separate presentation…why are you bringing it in the context of Sri Lanka,” Roy said.

TRS’s Rao told The Indian Express: “The presentation showed that Telangana’s debt is about 23 percent of GSDP(Gross State Domestic Product). They wanted to put the blame on states…I told them that the Central government’s borrowing is close to 60% of GDP. They said FRBM (Fiscal Responsibility and Budget Management) should be 3.5%. It is true that we (Telangana) have exceeded 3.5% but the Centre’s fiscal deficit is close to 6%.”

CPI’s Binoy Viswam tweeted, “Unfortunate that the government diluted the meeting on Sri Lanka. There was no need to mix up Indian states’ debt data there. They were keen to hide the national fiscal crisis…”

From the government side, the meeting was also attended by Parliamentary Affairs Minister Pralhad Joshi. Among leaders from other parties leaders were NCP’s Sharad Pawar, M Thambidurai (AIADMK), Farooq Abdullah (National Conference), Sanjay Singh (AAP), Ritesh Pandey (BSP), Vijayasai Reddy (YSR Congress) and Vaiko (MDMK).