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This article was first published 8 years ago  » Business » All is not right for the economy of India

All is not right for the economy of India

By Saugata Roy
December 21, 2015 09:22 IST
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A dancer performs at the rear of the historic Taj Mahal to promote tourism in Agra.


The National Democratic Alliance govt has not been able to bring black money from abroad as it had promised before the 2014 general elections, rues Saugata Roy

Before I go into the Supplementary Demands for Grants, let me say one or two things about the economy over which Shri (Arun) Jaitley is presiding. As was said by Shakespeare, 'All is not right in the state of Denmark', all is not right in the economy of India.

Today, I saw the value of the rupee has fallen to 67.10 (against the US dollar), which is the lowest in 20 years.

Now what does the fall in value of the rupee mean? It means that the rupee is not strong vis-à-vis the dollar.

They say that it has to do with the US Federal Reserve rate cut.

I am not going into the economic theories, but I say that this is a sign that our economy is not doing as well as it should.

Sir, I want to repeat the other thing, which he was mentioning, that inflation has been in check.

They say so, but what is the position with regard to retail inflation?

The inflationary trend in the Wholesale Price Index has been negative, but pulses and onion in the food items category turned costlier with inflation by 52.98 per cent and 85.66 per cent during October.

As you know, sir, the price of arhar dal crossed Rs 200 in some parts of the country.

Though they may claim that inflation is in check, the price rise is not in check.

Lastly, I want to say that the government has not been able to bring black money from abroad as was promised before the 2014 elections.

It has not been able to bring in investment to the extent possible.

Narendra Modi had raised hopes among the people of this country, especially the youth, that there would be investment and hence, employment.

That has not seen the light of the day.

The common man has also not got Rs 15 lakh (Rs 1.5 million) in their bank accounts which they thought would come when they opened accounts under the Pradhan Mantri Jan-Dhan Yojana.

These are the points I want to place on record.

Now, let me come to the Supplementary Estimates.

The finance minister has brought this Supplementary Budget under Article 115 of the Constitution with the recommendation of the president and under Article 113 read with clauses 1(a) and 2 of Article 115.

What is the total amount? The total amount of Supplementary Budget is Rs 56,256 crore. It is not a very big amount. If you take the total Budget, it was Rs 17 lakh crore (Rs 17 trillion).

So, this is only 3.2 per cent. It is not a big Supplementary Budget. Jaitley has further done some good 'housekeeping' by reducing the cost to the extent of Rs 38,000 crore (Rs 380 billion) as a result of which the net outgo, extra income, extra expenditure is only to the tune of Rs 18,000 crore (Rs 180 billion).

So, I would praise him for his financial “housekeeping” or bookkeeping.

But let me, at this stage, point out that when we spoke on Jaitley’s Budget, what were the things that we had raised here from the Opposition side?

We had said: “Yes, the Centre has devolved more money to the states as per the recommendations of the 14th Finance Commission and from 32 per cent it has been raised to 42 per cent”.

Now, the Treasury Benches were gloating over the matter. But, as we pointed out, this bigger transfer actually meant curtailing of the anti-poverty programmes meant for relieving the poor.

Which were the projects on which there was no increase? Mahatma Gandhi National Rural Employment Guarantee Act was not given any increase.

There were drastic cuts in Sarva Shiksha Abhiyan, the Integrated Child Development Services, the National Rural Health Mission -- all meant for nutrition, education and health of the common people of the country. . . (interruptions).

We had hope that whatever experience Jaitley and the ruling party had of the Bihar elections, they would turn away from their political thinking and start doing things for the poor.

I was expecting a Supplementary Budget in which these shortfalls would be made up.

But on the day the government/ruling party -- which had invested so much time and money into the Bihar elections -- got one of the worst drubbings in recent times from the people of Bihar, what did  Jaitley do?

Jaitley, as finance minister, announced a series of areas in which foreign direct investment (FDI) would be allowed.

In short, he opened his arms wide to say: “Well, we are not being able to revive the economy.

"Come one, come all, invest in India.” Now, we have been hearing these slogans for a long time like Make in India, “Bake in India” and “Cake in India”. So, this is a continuation of the same, and he opened the door to foreign direct investment.

Having spoken in general, now I shall only deal with a few specific grants. As I said, out of the Rs 56,000 crore (Rs 560 billion), not all are big allotments.

Somewhere he has spent Rs 1 crore (Rs 10 million) extra and somewhere Rs 2 crore (Rs 20 million) extra. . . (interruptions).

For the Cabinet, there is the Supplementary budget of Rs 196 crore (Rs 1.96 billion).

And one of the important items of expenditure is for meeting the expenditure towards clearing pending claims for maintenance of PM’s aircraft of Rs 144 crore (Rs 1.44 billion).

In a poor country we are spending Rs 144 crore (Rs 1.44 billion) extra because the Prime Minister has to fly all over the world to bring in Make in India.

So, Rs 144 crore extra is given in the Supplementary Demands.

Good! Now, he will explain how this helped the poor people in the country. . . (interruptions).

Sir, he has given extra money for reviving the Fertilisers and Chemicals Travancore Limited and for relieving the Indian Telephone Industries Limited.

I support these demands.

He has got the One Rank, One Pension on his head. The immediate outgo for pensions to military personnel will go up and he has given an extra Rs 5,700 crore (Rs 57 billion) for the military though they are not very happy.

Already the Chiefs of Staff are complaining about unfair treatment in the Seventh Pay Commission and veterans are again demanding that they will start an agitation.

It is a problem which I thought would be solved. So, even with Rs 5,700 crore (Rs 57 billion) I am not sure if the problem will be solved.

Saugata Roy is a Trinamool Congress MP in the Lok Sabha

Image: A dancer performs at the rear of the historic Taj Mahal to promote tourism in Agra. Photograph: Brijesh Singh/Reuters

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