Press Statement

The Polit Bureau of the Communist Party of India (Marxist) in session at Calcutta has issued the following statement:

The Polit Bureau of the CPI(M) strongly condemns the recent measures announced by the Government of India to reduce the interest on Public Provident Fund and small savings.

By this measure, though the government may be saving substantial amounts of interest payments and thus reducing its fiscal deficit, but it is doing so at the expense of the millions of common Indians who have put their lifetime savings in these schemes. They shall now earn lesser interest depriving them of much needed resources in hard times. The government is contemplating extending this to General Provident Fund. This will heap ruin on lakhs of workers who are members of this scheme.

Further, these measures will make the small saving schemes less attractive and are likely to divert savings into other avenues such as the share market or bank deposits. This would directly reduce the revenues of various state governments who currently receive 75 per cent of the small savings. By this measure, the state governments, already starved of resource generation avenues, will be further hard-pressed to meet the requirements of the people of the states. This is a measure that is directly in contrast to the essence of the federal principles of our Constitution.

Thus clearly the Government in order to reduce its fiscal deficit has imposed greater burdens on the people on the one hand and on the state governments’ on the other.

The Polit Bureau of the CPI(M) calls upon the people of the country to resist this measure which is only the beginning of a series of hard-hitting economic measures the government is proposing. These measures contemplated in the forthcoming budget will adversely affect the livelihood of the vast majority of the Indian people.