This refers to Shankar Acharya's column "A crisis foretold" (A Piece Of My Mind, August 7). Economic policy should be such that resources move from destructive to productive channels and plug the drain of resources. Our policies are pushing us in an opposite direction. Most productive resources are human intellect, technological advancements and synergy in human efforts; material resources are all subservient. Unfortunately, policymakers are blinded by the lure of revenue and are not able to comprehend the strangulation of entrepreneurship and disincentive to innovation by the taxation system. Most glaring is the prevalence of regressive, antisocial, inflationary, corruptive indirect taxes, that create hurdles and consume a major part of the productive intellectual energy. Enterprising human intellect is caught in the marsh of rules and procedures and is unable to spare some energy for innovation and productivity. The damage done by value reduction is certainly far greater than the value addition by leaky, illogical and inefficient doles for buying votes. We are sacrificing high value jobs to support low value jobs provided by the National Rural Employment Guarantee Act (NREGA). In the nineties, every year taxes were reduced and the economy started growing, but elections were lost. Service tax and NREGA appeared after 2004, sowing the seeds of economic destruction.
Satish Kapoor Pune
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