The Hindu : Front Page : "Meet CMP commitments"

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Monday, Feb 05, 2007
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"Meet CMP commitments"

Sandeep Dikshit

The joint note on the Budget says the Government should pare `subsidies to the corporates'

NEW DELHI: The Left Parties have called upon the Government to demonstrate political will to mobilise an additional Rs. 55,000 crores in order to meet "crucial" National Common Minimum Programme (NCMP) commitments.

Noting that total tax exemptions were over three times the additional resource required to meet assurances regarding health, education, farm sector and employment, the joint note on the Budget by the Left parties feels the Government should pare "subsidies to the corporates".

The Left's suggestions and proposals on the Budget released here on Sunday wants reintroduction of the long-term capital gains tax and revision of the "dismally low" short-term tax because the present rates are an "open invitation for reckless speculative activities". The obsession with cutting customs duties down to ASEAN (Association of South East Asian Nations) levels needs to be partially abandoned in this coming Budget because of its adverse impact on domestic industries and agriculture.

Concerns raised

The Free Trade Agreements with Thailand, Nepal and Sri Lanka have hit the vanaspati, rubber and TV industries. Concerns have been raised about some Indian producers routing their produce through these countries to avail duty exemptions.

Besides revising the customs duty in these cases, the Budget should also reduce the excise on small-scale industries in some sectors badly hit by imports.

Crop insurance

Insisting on a special focus on agriculture, the four Left parties have called for extending crop insurance to the entire country and all crops with an in-built flexibility to respond to local needs.

In order to insulate farmers from international price crashes, the Left parties have supported the Eleventh Plan Approach Paper's advocacy for a mechanism that includes the Commission for Agricultural Costs and Prices for signalling automatic tariff revision.

They noted the unwillingness by some highly profitable Central public sector enterprises (CPSEs) to reinvest their profits and instead "hold on" to cash.

"Clear signals"

In 2005-2006, all CPSEs invested Rs. 35,000 crores whereas they had reserves and surplus of Rs. 3,00,000 crores in the previous fiscal. "This trend towards under investment by CPSEs has given rise to genuine concerns whether public investment is being held up to create space for private competitors. The Budget should provide clear signals for a massive expansion of investment by CPSEs in the all the crucial sectors." Upgrading some of the mini-ratnas would have a positive impact in the overall climate of public sector investment, said the Left parties.

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