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COMMUNIST PARTY OF INDIA CENTRAL OFFICE
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COMMUNIST PARTY OF INDIA National Executive Meeting, November 1-2, 2008 Ajoy Bhavan, 15-Com. Indrajit Gupta Marg, NEW DELHI Resolution on The Present Economic Crisis of the Country. The National Executive Committee of Communist Party of India expresses its deep concern at the crisis that has set in the national economy as a direct fallout of the meltdown of American financial system India is in deep crisis. One immediate danger of global financial meltdown, is loss of job as is already in evidence in a number of sectors. There are reports of quiet downsizing and there is a loud talk of job cut, wage cut, and cut of the essential perquisites of the working people. As India’s growth slows down, inflation remains stubbornly high led by rise in the price of essential commodities. Inflation coupled with slowdown is likely to lead to stagflation. If India has not been brutally assaulted, it is due to the presence of strong public sector in the economy. If Left and the trade unions had not fought against the reckless globalisation and liberalization of the economy, India would have been much more vulnerable to the world crisis. Credit goes to the Left for sounding the warning bell against the World Bank reform model. According to ASSOCHAM release. The post-Diwali employment scenario is fraught with immediate danger of large scale layoffs and retrenchment. At least, in the seven specific strategic sectors, steel, cement, IT, financial and brokerage service, as also in construction, aviation and real estate business. There is a possibility as is being declared by ASSOCHAM of heavy curtailment of workforce by 25% to 30%. The impact of the situation on the small and medium size industry, who lived on large-scale outsourcing by the corporates is really dangerous. Impact of the crisis on the unorganized labour, farmers and masses of the people will be ominous. The first casualty of the diabolical crisis has been the small-scale industry dependent on export, already thousands of such firms have closed down. Agriculture is already hard hit. The Government’s policy of liquidity infusion releasing nearly Rs. 80,000 crores to the banking sector, further liberalization of cash reserve ratio, reducing Repo Rate has not been able to halt the crisis. Even virtual withdrawal of restriction on Participatory Note did not stop the out flow of foreign funds. According to one estimate nearly $35 bn. have moved out of the country. In fact government is pampering the stock market to revive without taking steps for boosting up the economic fundamentals of the nation. These are all steps in the wrong direction. Most ominous is the decision of the government to increase foreign direct investment in private insurance from 26% to 49%. When government take over is the most sought for bail out package even in America, the Government of India is moving in the opposite direction making Indian economy more prone to the volatility of the international market. This move will precisely help the foreign investors to make use of India’s hard earned social savings for their own speculative game. CPI strongly protests against the policy of the government to initiate further liberalization when there is a need for more restraint, when it has been proved that unregulated financial market does not take the economy forward. CPI calls upon the government to desist from further liberalizing the economy, exposing India more to global financial convulsion. CPI is firmly of the view that the conditions of global meltdown having its impact on India can be prevented by boosting the domestic market, stimulating the domestic demand, improving production and productivity, creating more jobs increasing the purchasing power of the people. The perspective calls for stepping up of massive investment in the productive sector for building up social infrastructure. The public sector making profit should be drawn in the national revival plan, investing their available surplus fund for expansion and execution of new projects. The state must act with decisiveness so that the calamity does not engulf the nation and prevent the corporates from downsizing and ensure steps to curb price rise. CPI calls upon all democratic forces and Left Parties to rise to the occasion and fight unitedly to bring about change in the outrageous economic policy pursued by the Government and the corporate move for downsizing and retrenchment. In this situation like this CPI believes that Indian working class led by the Trade Unions shall move into mass actions.
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