'Bharat Ratna' Chaudhary Charan Singh was more ‘socialistic’ than Indira Gandhi
Hailed as a son of the soil farm leader, Charan Singh believed in ruthlessly taxing the rich & “luxury” consumption in his only Union Budget.
In India, politics comes out of the shirts and pants of ordinary Indians even when there are no elections round the corner. It is inevitable then that there will be an element of politics in everything when elections come calling. No wonder, the decision of the Narendra Modi regime to confer the Bharat Ratna on former prime ministers Charan Singh and PV Narashima Rao along with Dr. M. S Swaminathan has triggered a political slugfest. This comes soon after a Bharat Ratna to former Bihar chief minister Karpoori Thakur (that prompted Nitish Kumar to come back yet again to the NDA fold) and LK Advani. Many family members of Rao are already in the BJP. And now, the grandson of Charan Singh, Jayant Chaudhry, an erstwhile I.N.D.I. Alliance member too is joining the NDA bandwagon.
But more than the politics on which dozens of opinion pieces have already been written, the author is intrigued by two things: first, the diametrically divergent economic policies of Charan Singh and Narashima Rao, and second, the fact that Singh was even more of a hardcore “socialist” than Indira Gandhi, the leader widely held responsible for taking the “soft socialism” of Jawaharlal Nehru to an era of “hard socialism” in terms of economic policies. This is neither an opinion, nor speculation or a surmise. Actual data bears out this proposition. Remember, another firebrand “socialist” leader in the ill-fated Janata Party government (who became a strong NDA ally later) George Fernandes had “thrown out” IBM & Coke from India. But that is another story.
By early 1979, the Janata Party government was in serious trouble. The magic of the anti-Emergency mandate of 1977 was waning fast as cracks within the constituents that formed the Janata Party had deepened. One of the leaders who posed the biggest threat to the Morarji Desai-led regime was Charan Singh. In a bid to save the government, Morarji Desai made Charan Singh the deputy prime minister on January 24, 1979, and allotted the coveted Finance portfolio to him. A little more than a month after that, Charan Singh presented his only budget as the Union Finance Minister. His economic philosophy and approach was made clear in the early part of the Budget speech that he delivered. During that Budget speech, Charan Singh declared: “…there will have to be greater readiness on the part of the people who can bear further taxation to shoulder additional burdens…private saving should be raised by a ruthless curbing of luxury expenditure and adoption of a more austere lifestyle in tune without traditional values and the hard facts of our economic life”.
So what was luxury expenditure according to Charan Singh and how did he as Finance Minister deal with it? Taxes, of course. Let’s see what exactly Charan Singh said and did in his 1979 Budget speech: “I have also selected some consumer items like soaps, toothpaste, toothbrush and detergents for increase in duties…excise duty will go up on household and laundry soap from 5.25% to 20%, on low priced toilet soap from 10.5% to 15%, on high priced toilet soap from 15.75% to 20%, on detergents from 13.13% to 20% and on toothpaste from 10.5% to 25%. I also repose to impose a 25% duty on toothbrushes.” Many wonder why well above 50% of Indians lived in absolute and abject poverty till the 1990s when the economic potential was so immense. The reason is simple: socialist policies that treated entrepreneurship, wealth and success with contempt. True, Jawaharlal Nehru and Indira Gandhi started an accelerated this folly. But even the first “non-Congress” Janata Party government of which the Jan Sangh was a part did not change direction. As the Charan Singh Budget shows, the new regime doubled down on the “punish the rich to help the poor” Robin Hood philosophy. Compare all ofhis with what P. V. Narashima Rao did (or was compelled to do) with economic policies in 1991.
The author is not even attempting to denigrate the legacy of Charan Singh. He is just pointing out the fact that, virtually all leaders of that era believed in some form of socialism. Contemporary Indians continuously crib about high income tax rates and Nirmala Sitharaman not raising exemption limits. Here is what Charan Singh said and did in 1979: “I propose to raise only the rate of surcharge for Union purposes of income tax in all categories of non-corporate taxpayers from 15% to 20%. The effect of this proposal will be to raise the marginal rate of personal income tax from 69% to 72%”
(Sutanu Guru is a journalist & author, and is Executive Director of CVoter Foundation.)
