The Congress on Monday said the Narendra Modi government had failed miserably to take measures required to revive the economy and that the Union Budget had deceived the poor, working class, farmers, and small industries.
Arguing that the government had inflicted a cruel blow on the citizens and the farmers by imposing cess on a large number of products, including petrol and diesel, instead of providing relief in these difficult times, former finance minister P. Chidambaram said: “Finance minister Nirmala Sitharaman had promised a budget ‘like never before’. The budget was a letdown like never before. The cess of Rs 2.50 on petrol per litre and Rs 4 on diesel per litre is like a vengeful act against the thousands of farmers who took out the longest tractor rally in history. It was also a cruel blow to federalism because the states do not get a share of the revenue from cesses.”
While expressing outrage at the paltry increase in the defence budget and statistical jugglery to dress up the provisions for health, Chidambaram said: “As expected, the finance minister has paid special attention to election-bound states. She announced large capital outlays for Kerala, Tamil Nadu, Bengal and Assam. People are not fools: they know that the proposals are only outlays and the actual expenditure will happen only after the schemes are approved and over a period of several years depending upon the pace of implementation. Let the people of the election-bound states know: Not one rupee of the proposed allocations will be spent in this year.”
Wondering if the Chinese had vacated the occupied Indian territory, Chidambaram said: “The finance minister did not mention defence at all. She did not mention that the defence expenditure in 2021-22 will see no rise. It is flat at Rs 347,088 crore, almost the same as the Rs 343,822 crore in the current year. She gave out a mind-boggling figure of Rs 223,846 crore for health, a breathtaking ‘rise’ from the current Rs 94,452 crore. As I had warned, it was a conjurer’s trick. She added the one-time cost of vaccination (Rs 35,000 crore) and the Finance Commission grants amounting to Rs 49,214 crore.”
Explaining the jugglery, he said: “She also included the allocations to the department of water and sanitation. Shorn of these add-ons, the allocations for health were Rs 72,934 in 2020-21 and Rs 79,602 crore in 2021-22. Given the inflation, the increase is practically nil. How can additional health infrastructure be built in these difficult Covid times with this increase?”
Lamenting that the revenue deficit (7.5 per cent) and the fiscal deficit (9.5 per cent) have exceeded every prediction, he said: “In 2021-22, the government estimates it will borrow about Rs 3.42 lakh crore less, but nobody is willing to believe. The government has also assumed that tax revenues will increase by 15 per cent — another questionable assumption. The revenue deficit and the fiscal deficit numbers for 2021-22 will send alarm signals to the investors and international lenders. Their apprehensions should have been allayed by laying out a credible fiscal correction path, year by year, until the year when the fiscal deficit will be 3 per cent or less. On the contrary, her target was 4.5 per cent by 2025-26. Investors and lenders will bristle.”
The Congress leader also described the increase in government expenditure, from Rs 34,50,305 crore to Rs 34,83,236 crore, as paltry. “The farm sector has been short-changed. The budget allocation form ‘Agriculture and Allied Activities’ has been reduced from Rs 154,775 crore to Rs 148,301 crore. Of total expenditure, the proportion has been reduced from 5.1 per cent to 4.3 per cent. The budget allocation for Market Intervention Scheme and Price Support Scheme has been slashed from Rs 2,000 crore to Rs 1,501 crore. The budget allocation for PM Kisan Samman Nidhi has been reduced from Rs 75,000 crore to Rs 65,000 crore.”
Regretting that nothing was done for the micro, small and medium enterprises (MSMEs) — to revive closed units and bring back lost jobs — Chidambaram also dismissed the meagre sum of Rs 20,000 crore for recapitalisation of public sector banks, alleging that the government wanted to sell off all of them. He said the Congress was not against private sector banks but wanted them to compete with strong public sector banks. He did not oppose the increase in FDI (foreign direct investment) limit in insurance sector to 74 per cent but recalled how the BJP had opposed even a 22 per cent FDI limit, forcing the then I.K. Gujral government to take back the bill. Chidamabaram also wondered why the finance minister presented estimates for two, three and even five years instead of one year that the budget is for.
The CPM politbureau in a statement described the budget as a colossal betrayal of people caught in pandemic and recession. “It is a classic illustration of the Modi government’s unshakeable commitment to promoting the interests of a handful of big business houses at the expense of increasing distress and misery for the working people. This is reflected in the refusal of the government to increase public expenditure notwithstanding its bombastic claims.”
The statement added: “The panacea for this government is to sell off India’s national assets and privatise even profit-making public sector companies. The monetisation project announced in the budget included sale of valuable land held at present by public sector companies. The target is to mobilise Rs 1.75 lakh crore through disinvestment. The increase in FDI in insurance to 74 per cent is highly objectionable. This drive for privatisation is a subversion of the national interests and a mockery of the slogan of Atmanirbhar Bharat.”
