The Hindu : National : A complete absence of application of mind: Sinha

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Friday, Jul 09, 2004

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National

A complete absence of application of mind: Sinha

By Our Special Correspondent

NEW DELHI, JULY 8. The Opposition parties today found little to cheer about in the General Budget presented by the Union Finance Minister, P. Chidambaram, and claimed that most of the proposals were a rehash of the measures announced by the previous National Democratic Alliance Government in its interim budget.

The former Prime Minister, Atal Bihari Vajpayee, was of the view that most of the schemes announced today were a carry over from his Government and wondered from where the United Progressive Alliance would find the resources to fund these schemes.

He described the Budget as a "mixed one" and did not share the view that it would spur growth. He also expressed his concern at the Government's silence on the Golden Quadrilateral project. Mr. Vajpayee did not accept the Government's claim that the measures announced by it would facilitate a growth in the economy.

A raw deal, says

Venkaiah Naidu

The BJP president, Venkaiah Naidu, however, came down hard on the Government and described the Budget as an "exercise in deception and deceit."Citing examples, Mr. Naidu said the Budget promised 100 days of guaranteed employment to at least one member of every family and this alone would require Rs. 3 lakh crores.

He regretted that the allocation for the Rural Development Ministry had been reduced from Rs. 19, 200 crores allotted by the NDA Government to Rs. 15, 998 crores.

"The Prime Minister's promise of a new deal for rural India has turned out to be a raw deal," Mr. Naidu said.

He also criticised the "meagre allocation of Rs. 31 crores for panchayats and Rs. 30 crores for flood control.

He said the budget did not mention either the Jai Prakash Narain Rural Trade Fund or the fund for small and medium industries created by the previous Government.

The former Finance Minister, Yashwant Sinha, was extremely critical of Mr. Chidambaram's decision to levy a two per cent across-the-board cess on all taxes and said it was a "mindless act." Mr. Sinha said it showed "a complete absence of application of mind'' on the part of the Minister.

Mr. Sinha clarified that his party was not against mobilisation of resources for education but was of the view that the Minister should have thought through the measure before announcing it.

According to him, the move to levy the cess was bound to have an inflationary effect and lead to price rise.

Mr. Sinha also sought to puncture the Government's claims of presenting an agriculture-friendly budget.

He said the Budget had failed to live up to the promises made in the Common Minimum Programme and that the allocation to the agricultural sector had only gone up by Rs. 900 crores. The hike in the excise duty on steel and edible oils was bound to be "inflationary."

Mr. Sinha expressed satisfaction over the increased Defence outlay but regretted that the NDA Government's plans for a capital expenditure non-lapsable fund had been abandoned. Budgetary allocation for Communication and Information Technology had also come down from Rs. 15, 682 crores to Rs. 12, 749 crores and the funds for Food and Consumer Affairs had plummeted from Rs. 149 crores to Rs. 84 crores, he said.

`Inflationary'

The former Agriculture Minister, Rajnath Singh, described the budget as "not pro-poor, but inflationary." On the farm front, the schemes announced by the NDA Government had been reiterated but there had been no decision on reducing the rate of interest on credit, which was reduced by the previous Government from 12 per cent to 8 per cent, which would really help farmers, he said.

The Telugu Desam Party, an ally of the BJP, expressed doubts over the Government's ability to keep the fiscal deficit down.

Senior party leader C. Ramachandraiah said that to keep the fiscal deficit down, the Government had to reduce spending on defence, debt servicing and revenue expenditure. The Government had hiked Defence expenditure by nearly Rs. 12,000 crores.

However, Suresh Prabhu of the Shiv Sena described the Budget as a "balanced" exercise that provided relief to various sectors such as agriculture and the working class.

"There are some welcome measures for micro irrigation."

He said the Finance Minister had tried to do a tightrope walk, keeping in view the demands of various sections and political parties. "He was not able to balance the Budget but balanced political forces," he added.

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