The Hindu Business Line : `Bland budget with very little for the poor'

The Union Budget presented by the Finance Minister, Mr P. Chidambaram, is a bland one, prepared with an eye on the ensuing State elections and with very little to offer to the poor, according to several experts, at a discussionon the Budget, organised by the Hindu Business Line, in association with ING-Vysya Bank, at the VUDA children's theatre here on Tuesday evening.

Mr E.A.S. Sarma, former Secretary, Department of Economic Affairs, Union Finance Ministry, who chaired the session, said that "usually budgets conceal more than they reveal and figures in themselves do not mean much."

Speaking from personal experience, as he was involved in preparation of several budgets, Mr Sarma said, "A budget should ultimately be judged on the basis of what it has got to offer to the poorest of the poor." On that count, he said, the budget presented by Mr Chidambaram was a hollow one.

He said that while the allocation for the defence sector and the establishment accounted for 3.9 per cent of the GDP, the allocations for agriculture, rural development and the social sector put together did not add up to that figure.

"It clearly shows the Government is only paying lip service to the poor and there is no attempt to implement the so-called flagship programmes in the common minimum programme of the coalition partners," he said.

Mr Sarma expressed concern over mounting debt, the likely inflationary spiral with high oil prices and the lack of fiscal prudence in the Budget.

Mr K. Haribabu, former MLA and a member of the Marine Products Export Development Authority, said it was laudable that the Finance Minister had allocated Rs 1,75,000 crore for rural credit at 7 per cent. "However, the credit has to reach the farmer and the hurdles in implementation should be removed."

He faulted Mr Chidambaram for not allocating much to the irrigation projects in the State. "The Congress-led coalition is in power at the Centre and a Congress Government is ruling the State. But the allocation for the massive, ambitious irrigation projects taken up by the State is very poor," he said.

Mr C.S. Rao, retired IES official and president of NGO Praja Spandana, said the Budget was disappointing from a common man's point of view.

"Officially, 26 per cent of the population is below the poverty line, but actually the figure is much higher. Nearly, half of our population is surviving at the subsistence level, or even below that, and Mr Chidambaram has not got anything for them," he said.

Mr Rao said the Budget did not have enough for the improvement of the public transport system. "On the whole, we are moving from egalitarianism to elitism," he said.

Mr G. Prabhakara Sastry, convener of the Tax Law Research Group and a tax consultant, said the SSI sector was being subjected to slow poison for several years and the current Budget was no exception.

Terming the increase in service tax a hasty move, he said the penal provisions for not paying service tax were too harsh. He also wondered why certain professionals, such as doctors and advocates, were not brought into the tax net.

Mr G.M. Rama Rao, former CEO of J.K Pharmachem, and Mr G.R. Kumar, chartered accountant, said the fringe benefit tax should have been done away with. "Instead, the Finance Minister has only made certain cosmetic changes in it," they complained.

Mr P. Lakshmana Rao, Vice-President (Retail), ING-Vysya Bank, said his bank had sponsored the programme to promote better understanding of the budgetary process. Mr T.V. Suresh, Regional Manager of The Hindu, welcomed the gathering and Mr B. Prabhakara Sarma, Chief of Bureau, The Hindu, proposed a vote of thanks. Mr M. Somasekhar, Chief of Bureau, Business Line, compered the show.