FOR CONSENSUS

Centre needs to address concerns of the states postdemonetisation to ensure smooth GST rollout

THE MEETING OF the Goods and Services Tax (GST) Council over the weekend turned out to be inconclusive, with some of the states sparring with the Centre over issues such as dual control or sharing of administrative powers for overseeing the new taxation regime. This comes even as the Narendra Modi government is desperately attempting to push through enabling bills relating to the GST in the current session of Parliament. The Centre may well be in a hurry to get these passed in order to meet the deadline of April 1, 2017 to roll out the new taxation regime, which will pave the way for a national market and has the potential to boost growth in the medium term.

Unfortunately, though, all this is at a time when states are facing a “double whammy” — as West Bengal’s finance minister, Amit Mitra, put it — in the form of a slowdown and a hit to their revenues from the Modi government’s decision to scrap high value notes. That’s why states, especially those ruled by non-bjp parties, are seeking a discussion on demonetisation in the GST Council, even though there are those — including at the Centre — who are arguing that the two (GST and demonetisation) are unrelated. Technically speaking, they may not be, but the fact is the decision to demonetise has, in one sense, been like a force majeure event for states, already weighed down by lower revenues from the general economic slowdown and the slide in commodity prices. The huge impact on consumption and state revenue collections on account of demonetisation — which was, after all, a decision of the Centre — cannot be ignored.

Of course, it can be argued that the revenue concerns of states will anyway be addressed, since the compensation formula on account of possible revenue loss from the transition to GST envisages 2015-16 as the base year, with 14 per cent revenue growth being built on that for the next year onwards. Having said that, this may not be a tactically opportune time for the Centre to be seen as browbeating the states into getting GST implemented. India’s history of reforms, including the one relating to Value Added Tax, shows that even though there have been delays on the way, much of the progress achieved has been on the back of broader consensus. The Centre should show some flexibility on compensating states for revenue losses suffered because of demonetisation in the current fiscal, apart from allowing them greater leeway to borrow in what is undoubtedly an exceptional economic situation. There is always merit in getting all states, including Opposition-ruled, on board in big reform decisions. GST certainly falls under that category. LEFT BEHIND IN the rubble at Nagrota, the detritus of a fidayeen: An assault rifle, ammunition, injectable painkillers, and, incongruously, a small bottle of cheap, yellow ittar. The terrorist who carried these things, we know from the testimonies of others, would have risen early that morning, bathed, prayed, and shaved himself from head to foot. He’d have darkened his eyes with kohl, like a traditional bridegroom, and then perfumed himself, so he did not stink of war when the houris he had been promised greeted him inside the gates of heaven.

The mother of one such fidayeen, Imran Majid Butt, wrote this poem: “I wait for the day, O’allah, when you will call out: ‘Who is the mother of this blood-drenched rose?’”

Ever since September’s strike on the 12th Brigade’s headquarters in Uri set the Line of Control ablaze, and brought India and Pakistan closer to war than they have been since 2002-2003, the cult of the fidayeen has seared itself on our public discourse as never before. India, it’s been claimed, is facing a grim new kind of war. Facts, though, tell another story: Fidayeen warfare is, in fact, a sideshow, militarily ineffective and strategically marginal to the jihadist insurgency in Kashmir. The cult of the fidayeen is about dying, not killing. The hysteria we now see, both in the media and among policymakers, is precisely the end it is intended to secure.

The Lashkar’s fidayeen war began in 1999, soon after the end of the Kargil war: To the jihadist movement, it signalled that Pakistan’s military defeat was not a reason to lose heart. That July, a single Lashkar fidayeen entered the Border Security Force’s sector headquarters at Bandipora, and proceeded to hold off an assault involving the elite, but tactically unsound, National Security Guard for three days. In November, that year, two Lashkar fidayeen stormed the 15 Corps’ headquarters in Srinagar’s Badami Bagh, killing eight soldiers.

“I announce the breakup of India, inshallah,” Lashkar chief Hafiz Muhammad Saeed said soon afterwards, addressing an ecstatic crowd of over 250,000 people at the terrorist group’s annual congregation in Muridke.