Finance Minister K M Mani has welcomed the substantial increase in outlay in the Union Budget for the agriculture sector and flagship programmes in the rural development sector. Mani, who expressed satisfaction at a projected growth rate of 8 per cent and measures to control fiscal deficit, however was unhappy that nothing has been proposed to contain current account deficit.
He was speaking at a post-Union Budget discussion,organised by the Rajiv Gandhi Institute of Development Studies (RGIDS) under the KPCC,here on Thursday
‘’There is a big setback for Kerala as the Vizhinjam project has been ignored in the budget, whereas Tuticorin port in Tamil Nadu has been earmarked a substantial outlay. This has to be corrected,’’ Mani said.
He also asked how the Centre and Union Finance Ministry could neglect inflation after the administered pricing mechanism for petroleum products has been done away with. ‘’There should be an alternative mechanism to contain inflationary trends,’’ he said.
Mani said that the Union Budget could not be viewed as anti-people. ‘’The IT slabs have been left untouched. For those with an annual income of between Rs 2 lakh and Rs 5 lakh a tax credit of Rs 2000 has been allowed. Proposals to empower women are progressive. For Kerala, the Rs 75 crore scheme for cocount growers should be welcomed. That the allocation to provide farm loans has also gone up to Rs 7 lakh crore and private banks have been included in the scheme is very important. Measures mooted for Skill Development Programme are also notable, ‘’ Mani felt. He added that the ‘Kerala model’ had been accepted by Chidambaram with regard to the Skill Development Programme.
‘’The UDF Government had launched the Entrepreneurship Development Mission here, wherein training has been imparted to 990 youths and an interest free loan upto Rs 20 lakh has been provided as seed capital for starting ventures. Loans for nearly 400 enterprises have been sanctioned’’, Mani said.
Former Finance Minister Thomas Isaac said that there is nothing in the Budget to propel growth.
The Plan expenditure has been cut instead of increasing it on an annual basis, he said. The high trade deficit was another matter of concern. No attempts has been made to increase agricultural productivity, he said. ‘’Agricultural sector has not been given the much needed push’’, he said.
‘’The only focus of Chidambaram in the budget was to overcome the current account deficit by keeping investors, domestic and foreign,in good humour,’’ he said. ‘’What Chidambaram has done was diametrically opposite to what his predecessor Pranab Mukherjee had done,’’ he said.
He also felt Kerala will suffer due to inadequate allocation for the Vizhinjam port. ‘’ As in the case of Railways,the state has to raise its voice unitedly on the neglect towards issues of the agri-sector and Vizhinjam port’’,he said.
Transport Minister Aryadan Mohammed questioned the logic of Thomas Isaac who kept insisting that the total plan outlay has not gone up to 29.4 per cent than the previous year, as was claimed by Chidambaram. ‘’ One has to look at the revised estimates and expenditure at the end of a fiscal, while comparing the figures, instead of original estimates in a budget’’,Aryadan said. However, he admitted that that the root cause of ills plaguing the Indian economy was that exports are not increasing.
‘’We are suffering because of failure to attract sufficient FDI funds. However, one should not forget that apart from China and Indonesia, India is the only country which had not posted negative growth rates on account of global recession,’’ Aryadan said, justifying the budget as pro-growth.