Offer freebies only if you can bear the burden: FM to States

With Prime Minister Narendra Modi’s recent observations on freebies triggering a nationwide debate, Union Finance Minister Nirmala Sitharaman has asserted that the political parties should justify their freebies and show the States’ abilities to bear the burden.

“You should remember someone somewhere must pay for freebies. You should be able to provide for in your budgets to pay for the freebies. If you are borrowing to meet the freebie promises, you should show whether you have enough revenues (to repay the loans,” she said.

Referring to free power schemes, she said discoms and gencos would ultimately take the burden though it was not them that promised free power to farmers.

Nirmala Sitharaman, who is on a three-day visit to take part in party activities in the State, has used various platforms to refute the allegations made by the ruling Telangana Rashtra Samithi (TRS) on issues like FRBM, cesses, devolution of tax revenues and alleged discrimination against certain States.

Addressing a press conference on Saturday as she wraps up her visit to the State, the Finance Minister said the country’s economic growth was on a ‘sound wicket’.

India at zero risk

Several international agencies have flagged that some major economies of the world were on the verge of slipping into recession.

Quoting a Bloomberg analysis, she said that economies of Sri Lanka, New Zealand, South Korea, Japan and China were faced with a high risk of slipping into recession.

“The risk for India is zero. In fact, we are one of the fastest growing economies in the world,” she said.

Giving it back

Refuting the criticism by the TRS Government on not increasing the FRBM (Fiscal Responsibility and Budget Management) limits, she said that the Centre had given relaxation during the Covid pandemic as a contingency measure, indicating that it (relaxation) would not longer be available.

She said the borrowings beyond the budget would impact the State’s finance and increase the debt burden on people and it was the Centre’s responsibility to keep tabs on the States finances.

Referring to the collection of cesses (which need not be shared with States) by the Centre, she said that the Government was using the receipts for the purposes the respective cesses were collected.

“The receipts would again go back to States for the development of roads, health and education,” she said.

On devolution of tax receipts, she said that the devolution happened following the recommendations by the Finance Commission.

“We don’t discriminate certain States and try to benefit others (out of the way). We can’t do it even if we want to,” she said.

When her attention was drawn to some fintech companies collecting money, she the Government would work with the RBI to ensure it didn’t happen.

Earlier addressing farmers, she refuted the criticism that the Modi Government was not coming to the rescue of farmers. Listing out fertiliser subsidies, she said the Government was heavily subsidising urea despite the fact that the cost of imports had gone up tremendously.

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