Finance Minister P Chidambaram said on Wednesday that the recent electoral verdict has mandated him to protect and promote that part of the public sector that has created wealth and made India stronger while providing space for the private sector.
Replying to a debate on the General Budget for 2004-05 in the Lok Sabha, he said the verdict was a "complex" mandate to take another look at the reforms process and on the people who had been left behind so far.
"The electoral mandate we have got also requires me to revisit some of the priorities of the reforms and rearrange the priorities in which people will be taken as a key resource in national economic activity," he said.
Terming Common Minimum Programme as a policy road map for five years, Chidambaram said this would address the concerns of all allies and supporting parties.
He said investment in agriculture, industry and services was key to maximise income and welfare to provide employment opportunities and asserted that the government was committed to improving the delivery mechanism.
Chiding the BJP-led opposition for not reconciling to the electoral mandate, he said the National Democratic Alliance had expected to be back in power while some in the ruling United Progressive Alliance were sceptical of forming the government.
On the task laid down in the CMP, Chidambaram said the government's endeavour was to lay greater emphasis on education, health, nutritious schemes, drinking water and public distribution system, especially for the people below the poverty line.
Chidambaram said the Budget has given a major focus to agriculture with particular emphasis on credit. "If we can raise the credit from Rs 80,000 crore (Rs 800 billion) to Rs 1,00,500 crore (Rs 1,005 billion) then there would be great hike in production," he said.
He said the accelerated irrigation programme and the watershed programmes were designed to improve water supply and irrigation conditions in the rural areas.
As far as agriculture is concerned, he said, a major initiative was the Income-Tax exemption under Section 80-ib for agro-business.
The finance minister said the programme for restoration of water bodies, being taken up on a pilot basis in five districts, if successful would be extended to other places.
Asserting that agriculture would remain at the "centrestage", Chidambaram said the farm sector needs to be made "monsoon proof" through well-designed irrigation and water harvesting schemes.
He said economic growth had been less than five per cent during --1997-98, 2000-01 and 2002-03 -- when the agriculture sector performed poorly because of scarce rains.
The minister said whenever agriculture sector performed well, the economic growth was higher.
He regretted that there was stagnation in agriculture investment, which, he said, remained at 1.3 per cent of the GDP during the NDA regime.
The finance minister also expressed concern over the divide between rural and urban sectors in terms of both consumer spending and education.
The Planning Commission, in the next few weeks, would allocate more funds for the food for work programme and the total component would be much higher than the allocated Rs 4050 crore (Rs 40.5 billion) as against Rs 3712 crore (Rs 37.12 billion) allocated last year, Chidambaram said.
Stating more job opportunities could be created only if the economy grew by 7 to 8 per cent, he said this would take time and in the interim period the government would continue to deploy greater resources.
On the issue of power sector reforms, Chidambaram said 10 projects have already achieved financial closure while seven more projects would achieve financial closure in another three months envisaging an addition of over 8,200 MW.
With regard to allocation for rural development, he said more than 13.7 per cent enhanced allocation has been made for the Ministry of Rural Development alone.
Chidambaram also announced that Planning Commission would announce additional allocation out of Rs 10,000 crore (Rs 100 billion), as announced in the budget, for the different sector within next two weeks.
