By Haider Abbas
The economic meltdown, not only in India, has now reached the heart of Europe, as it has got to the highest echelons in England, the benchmark of the most formidable currency in the world-the UK Pound Sterling, has now crashed to an all time low! Never in the past around 100 years has the world seen or believed that such-would-happen but this is what England is right now up to. The Russian-Ukraine war is also one of the prime reasons why England Pound Sterling is slated to slide down to the US Dollar, and as the skeptics argue, it may even have a fate of Turkish Lira.
Ever since the change of guard in England, since Mary Elizabeth Truss, took over as PM after Boris Johnson, the economy of England was on a shaky ground, as within a fortnight to her ‘oath-to-office’, on September 16, the currency of England has plummeted to the historic low, in the last so many years. It has been reported on Edition.CNN that ‘British pound (has) plummets to record low against the dollar.
The currency slump follows British Chancellor of the Exchequer announcement that the United Kingdom would implement the biggest tax cuts in 50 years at the same time as boosting government borrowing and spending in the face of high inflation. This is where Liz Truss, as she is popularly called, was found napping as her ‘trickle-down-economics’ policy seem to have completely boomeranged!
This policy in question had to be a flop, as it was nothing but a wishful thinking, that the ‘rich and the corporates’ would be given the highest waiver in taxes, which would enable the ‘ same likes’, to start to invest more, and thereby, start industries to provide employment and job avenues. But, the calculations went awry and instead the ‘rich and corporates’ hoarded the money or sent it to the offshore accounts! The ominous trend therefore can rightly be felt on the whole economic windscreen of England, which had also recently been supplying arms and ammunitions to Ukraine against Russia, incurring heavy loss on its exchequer too. Surely, the rich or the ultra rich, who in today’s life are bereft of morality and ethics, and instead are governed primarily by the life-style, have belied the hopes for British economy. The tax-waivers given to rich land up in Panama accounts and crypto!
How will the white’s man burden to straddle its economy is what is to unfold, and surely, England will be able to recoup its falling fortunes, as after all, it has been the center of world’s polity, and to an extent supremacy, in the last once century only second to US, as England has been the center of imperialism and capitalism for centuries, and has been the leader of the world, hence, it is not very likely that anything of this propensity may-get-wrong in England. The economic wizards of England will soon sit to revamp the fall of their currency and very soon the world would see a massive-upliftment in it. But, what India is to gather from the scenario unfolding in England? This is what matters here?
In India there are various news reports that Indian foreign reserves have shrunk heavily in the recent months and have reached to the figure of 80 billion USD, and not a single day passes when Indian Rupee does not fall more to USD, which has even prompted Reserve Bank of India to start initiatives to De-dollarise the Indian economy, but that all, as such, is a distant dream. On the contrary, the present NDA government led by BJP PM Narendra Modi, has been lavish into distributing freebies to of course ‘friends’ of government, as in August last, it has come to light that that BJP has written-off around 10 lakh Crore of loans, as ‘gift loan waivers to friends on a platter’ informed Mallikarjun Kharge, the leader of Opposition in the parliament.
The mainstream media in busy painting a rosy picture, but things on the ground speak differently, as the United Nation Human Development Program report published on September 22, show that India is ranked 132/191 nation in terms of its human development index! Can India ill afford such ‘written-off’ loans to the scale of around 10 lakh crores? How India will survive the rise of USD’s onslaught against the Rupee, will definitely need a miracle to save India from the doomsday as economists are exhorting to be prepared for a Sri Lanka type crisis lurking around in India too.
How will India be able to save its ‘falling-economy’ and also ‘falling-Rupee’, while exhausting its foreign reserves at such a rapid pace, despite the much touted fifth-largest economy status in the world, amid the claims to make India a five-trillion-dollar economy, is all yet to be seen. The doomsday predictors are of the view that it won’t surprise if 1 USD also touches for a Rs 100 mark, the way the petrol/diesel could touch Rs 100/liter, and which, has drastically led to a huge inflation in practically everything under the sun.
How will India resuscitate, with millions and millions of its citizens under poverty-line, from this ever growing ‘nasty’ economic situation is what needs to be monitored, particularly, in the wake of the weakening of British Pound Sterling, as India will need to take some immediate lessons from it.
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The writer is a former UP State Information Commissioner and writes on international issues.