Hot News

Budget Bluff

Budget Bluff

We all know that time and tide wait for no one. Yet, we Indians do not value time at all. We can endlessly discuss whether a lady police officer should have entered a party office in search of some criminals who were allegedly hiding there. Where else in the world is law and order discussed? And where else is a Prime Minister disrespecting a court order that grants equality of worship to every woman?

On February 1, we saw a monumental wasting of time when Parliament discussed the Interim Budget presented by Interim Finance Minister Piyush Goyal. Of course, we believe in the maxim, “no taxation without legislation”, the slogan first raised in the US. 

The government certainly needed Parliament’s permission to spend money beyond April 1. There are other legitimate ways to spend money like seeking a vote on account.

Prime Minister Narendra Modi wanted a Budget so that he could have six budgets in his term of five years. Everyone knows that it is a Budget for Ballot. It was with the Lok Sabha election in view that he asked the interim finance minister to present a Budget that provided him with a photo opportunity that no other minister gets.

The know-all Arun Jaitley is now recuperating in a hospital in the US. The Press note had said that he had gone to the US for a routine check-up. Who goes to the US for routine medical check-up when Medical Tourism has been a growing industry in India?

I had done a column when the same Modi as Chief Minister had made a frontal attack on Sonia Gandhi for spending billions of rupees on her medical treatment based on a fictitious report in a Gujarati vernacular newspaper. I asked him how on earth billions could be spent when she flew in a service plane like Goa Chief Minister Manohar Parrikar.

Jaitley is now in the US but he continues to be a minister so that the government can foot his medical bills. Is this an arrangement worthy of a party which supposedly lays great store by the medicinal properties of cow urine? What kind of nationalism is this that you fly to the US when you sneeze in India? 

Unlike Modi, I do not want to question the spending on the medical expenditure on the finance minister. He is one person who has been defending every wrong action of the government and, therefore, Modi is eternally obliged to him though obligation is not a word in his lexicon as everyone from his party colleagues, LK Advani to R Balashankar would vouchsafe. 

Everyone wishes Jaitley the best of health. However, people have doubts about the seriousness of Jaitley’s disease for he has not been just recuperating. Rather, he has been fighting a heroic battle to attack the case CBI has instituted against the lady who held the reins of the largest private sector bank, the ICICI Bank.

Chanda Kochhar was the Chief Executive of the bank when it advanced a loan of Rs 3,250 crore to Venugopal Dhoot’s Videocon Group. Dhoot, in turn, allegedly invested Rs 64 crore in a company operated by her husband Deepak Kochhar. Everybody would see it as quid pro quo but not Jaitley.

When the CBI registered a case against her as the main accused and some board members as co-conspirators, the officer who had been investigating the case was summarily transferred. It was to weaken the case and, thereby, allow the lady to escape. It was surprising that Jaitley came out in support of the fraudulent transaction.

Unfortunately, for the government, an internal inquiry by the bank found Kochhar guilty and sacked her with retrospective effect. She had quit the bank service when the scandal surfaced. The bank has started action to get back all the bonuses and shares she received since 2009.

Kochhar has in a statement rightly said that the decision to advance the loan was taken by the board and everyone on the board were equally guilty. Her statement made perfect sense. That is exactly what the CBI did. From the US, however, Jaitley questioned the yet-to-be-taken action against the board members “with or without evidence” for it would disrupt the banking sector. The board members are some big-wigs and he wanted to protect them. 

Had he been in India, he would have ensured that no action was initiated against Chanda Kochhar who at one time was the toast of the banking sector. Jaitley’s illness brought Goyal to the finance ministry.

The parliamentary elections have to be completed and a new government sworn in by the end of May. That leaves just two months of the next fiscal for the Finance Ministry. Basic courtesy demanded the government to leave policy decisions to the new government. No, Modi saw it as an opportunity to get some votes. Goyal’s budget has as much credibility as the promises Modi made five years ago.

The Budget gives some marginal concessions to the salaried class. An impression has been created that the tax slab starts at Rs 5 lakh. The fact is that the existing tax slab of Rs 2.5 lakh to Rs 5 lakh remains. A senior citizen like me does not have to pay any income tax if the income is within Rs 5 lakh. Now with upto Rs 1.50 lakh in savings, one with an income of Rs 6.5 lakh can escape paying tax. It is no big deal.

The point is that the concession is very marginal. One of the first acts of the Modi government was to force tens of millions of poor people to open bank accounts. The banks have to spend enormous sums of money to service these accounts. Everyone who opened the accounts believed that  the government would deposit Rs 15 lakh he promised once the trillions of rupees stashed away in foreign banks were brought back to India.

Forget bringing back trillions, billions of the taxpayers’ money was spirited away from the country by the likes of Nirav Modi and Vijay Mallya, who claimed to have met Jaitley just before he flew away using his diplomatic passport.

Instead of Rs 15 lakh Modi promised before he reached Delhi, he promises Rs 6000 per year to every farmer in distress. It works out to Rs 500 a month. Now, how did he do this? One significant achievement of the government is that cow slaughter has ended except in the Northeast, Kerala and West Bengal.

In doing so, the government has deprived millions of Muslims and Dalits of their traditional occupation. Earlier, a farmer could sell his unproductive cows and bullocks to the butcher and earn upto Rs 25,000 per cattle, depending upon its meat value.

Now nobody buys old cows and bullocks depriving the farmer of a big sum of money. The Hindu farmer may not eat beef but the beef helped him to manage his household expenditure. Now the Budget promises him Rs 6000 while much more is needed to feed the unproductive cattle so that they do not destroy their and their neighbours’ crop.

Similarly, the monthly pension of Rs 3,000 to the workers in the unorganised sector that the interim budget promises is only when he contributes to a pension scheme. So, it may take years for him to get the pension.

Actually, it is pointless to discuss the Budget when it has no practical value. The new government formed after the elections will have its own plans for the future. Even in the unlikely event of Modi returning to power, he may have better claimants to the post of finance minister than a lawyer who defends his client not because he is ethically right but because he can pay his fees, however high it is.

And if the next Prime Minister is anyone from Rahul Gandhi to Nitish Kumar to Pranab Mukherjee to Mamta Banerjee to the much-experienced HD Deve Gowda, he or she will have his or her own ideas of taxation. So ideally, Modi should have told the House how he fulfilled the manifold promises he made during the 2014 elections.

Just take one promise. The promise to create two crore jobs a year. By now, an additional 10 crore people would have been in jobs. What is the achievement on this score? According to the latest National Sample Survey Office (NSSO). the unemployment rate has touched the lowest point of 6.1 per cent in 45 years.

The government knew that the NSSO report was not flattering to the government. It even tried to browbeat the organisation not to publish the report, forcing its acting chairperson PC Mohanan and JV Meenakshi to quit their posts. Even a person appointed by Modi as Governor of the RBI was forced to resign. 

When a person does not like to leave like the CBI Director, he is sacked overnight. The Niti Ayog has come to the defence of the government quoting statistics from private organisations and individual research, never used in the past to assess job creation.

It is like quoting India Today to claim that such and such Chief Minister was the most successful Chief Minister. Few knew that the magazine zeroed in on a person on the basis of the ad revenue it could be generated from the state concerned. Of course, it is not difficult to pinpoint the reason for the drop in the employment ratio.

It is the demonetisation which Modi announced with great fanfare that should be blamed for the phenomenon. Many lost their jobs because of this Himalayan blunder but Modi never accepted it. Nor did his party.

Instead, they tried to whitewash it by refusing to give details of the money that returned to the bank. In Digital India, the RBI took two years to count the quantity of the old Rs 1000 and Rs 500 notes that returned to the RBI. Finally, it was forced to admit that nearly 100 per cent of the demonetised currency notes were in the RBI custody.

Another great idea to create jobs was the promotion of the. Make in India campaign. How sincere the government was became clear when Modi himself negotiated with the French government and bought over five dozen Rafale fighter aircraft off the shelf paying much more money. 

He was keener to give a new lease of life to an Ambani company which never made even an aircraft nut to become a partner in the deal. His love for Adani who bankrolled his election campaign in 2014 is all too well-known. That he loves the Ambanis became clearer when the university set up by Mukesh Ambani was given the status of an institution of excellence.

It did not bother the government that not even a brick had been laid for the university and not even a teacher was appointed and a student enrolled. Now, calculate the increase in the assets the two have created over the last five years. We had seen how Amit Shah’s son’s business grew at a world record of growth.

Today Ambani’s wealth is more than that of several small states put together. How come that when more and more people are pushed into unemployment, multimillionaires register a phenomenal growth in their assets and income! This is a reflection of the skewed economic policy that the government has been following.

To paraphrase Karl Marx, the budget demonstrates how the caste and religion-based political mobilisation created circumstances and relationships that have made it possible for a grotesque mediocrity to play a hero’s part. To quote him again, Budget repeats itself first as tragedy and, then, as farce, called interim Budget.


(Published on 04th February 2019, Volume XXXI, Issue 06)