The Hindu Business Line : Budget document election manifesto of the Congress: Sinha

Kolkata, March 5 Describing the Union Budget 2008-09 as a “fraud on the process of budget-making”, Mr Yashwant Sinha, former Finance Minister and BJP leader, said making no budgetary provision for the Rs 60,000 crore outgo on loan waiver to farmers was unheard of in any budget presented so far in the country.

He described the budget document as the election manifesto of the Congress Party, which, according to him, was cleverly preparing the ground for early elections.

Speaking at an interactive session on the Union Budget 2008-09, organised by the Swadeshi Research Institute here today, Mr Sinha said Mr Chidambaram was leaving behind a huge unsettled liability (of nearly Rs 2 lakh crore, which includes loan waiver, loss on tax sops, subsidies outgo and the Pay Commission payouts) for the next elected government.

He said even the Railway Minister had made a budgetary provision of Rs 4,500 crore towards higher outgo on salaries and pensions a la 6th Pay Commission recommendations. On the other hand, he pointed out, a provision of Rs 300 crore was made by the Finance Minister in his budget for the proposed desalination plant in Chennai, without the proposal being subjected to any discussion. “Where is the fiscal rectitude here?”

Mr Sinha also contested the claim by the Finance Minister that sops on direct taxes were revenue-neutral, stating that as per figures doled out by experts, revenue losses here could be anything between Rs 15,000 crore and Rs 20,000 crore.

“If the Finance Minister can make up such a substantial figure apparently through better compliance, why can’t a figure of Rs 5900 crore (estimated loss on the indirect taxes front) be made up?”

Describing inflation as a major issue, which has not been touched by the Finance Minister, Mr Sinha said credit contraction has taken place because of the tight money policy (a regime of rising interest rates) being pursued. Pointing out that this was actually causing the economic slowdown, he said “we need to reduce interest rates to stimulate demand in the marketplace, and provide that growth impulse to our economy.”

He said making a special dispensation for a particular minority community in a Union Budget was nothing but “communal budgeting”. A document like a Union Budget, he felt, should never have a religious angle to it, if its sanctity has to be maintained. He said steps to protect the weak and the vulnerable were most welcome, but not on the basis of religion.

Explaining why the Left was longer so combative in its opposition to the proposed Civil Nuclear deal with the United States, Mr Sinha said the Congress-led UPA was now baiting the “comrades” to cause an early downfall of the government so that early elections could be precipitated on the basis of the Budget sops.

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