The Associated Chambers of Commerce and Industry of India (Assocham) has urged political parties to refrain from offering free power and foodgrains like wheat and rice at highly subsidised rates, saying such freebies could stunt economic growth in the long run.
In an appeal to political parties on Wednesday, Assocham said they should balance their offer of free power to farmers and others with specific steps to prevent misuse.
Likewise, it said, parties should concentrate on alleviating measures to prevent starvation deaths while promising subsidised wheat and rice for the poor through the public distribution system.
"Experience has shown in the past that whosoever political parties promised free power and hugely subsidised wheat and rice to poorer sections ultimately landed in problems as it is difficult to keep such promises," Assocham said.
"The state electricity boards and food departments have suffered heavily as their losses mounted on account of free power and delivery of subsidised rice and wheat," it added.
Arguing that such sops were often misused with the targeted beneficiaries seldom gaining anything, the chamber advised political parties not to "unnecessarily resort to such promises" which eventually eroded government revenues.
Assocham noted that several parties have offered free power to farmers, adding, "Such laudable concern among the political class for farmers who from the core of Indian economy needs to be made more effective."