[Marxistindia] on union budget

[news from the cpi(m)]

                                                           July 06, 2009

Press Statement



The Polit Bureau of the Communist Party of India (Marxist) has issued
the following statement:



                        On Union Budget 2009-10

The Budget placed by the Finance Minister in Parliament today is grossly
inadequate in meeting the challenges of economic recession, growing job
losses and declining purchasing power of the masses. The total
expenditure is slated to increase by a mere 2% of GDP only, essentially
to meet non-developmental expenditures like interest payments and
implementing sixth pay commission recommendations. Therefore, this
Budget neither provides a stimulus for growth nor meets the needs of
“inclusive growth” for the aam admi.



While the Government has failed to provide the resources required to
stimulate the economy the neglect of its role in terms of allocations is
more significant in areas that touch on the lives of the mass of the
people. Crucial sectors, like agriculture and rural development, where
the effects of the prolonged agrarian crisis and the agricultural growth
slowdown of 2008-09 have been severe, have been provided little support
in terms of Plan outlays. The required lowering of interest rates to 4%
on farm loans has not been done and instead only an incentive to repay
loans on time has been announced. 



The allocation required to implement the Right to Education is
shockingly absent in the Budget. The increase in budgetary allocation
for elementary education is less than Rs.200 crore. The non-seriousness
of the Government for the universalisation the ICDS is seen in the
meagre increase in allocation of only Rs. 360 crore. The allocation for
the social security schemes for the unorganised sector workers is only
Rs. 100 crore more than last year, belying the claims made by the
Finance Minister. While the increase in minimum wage for the NREGA to
Rs. 100 is welcome for the States where the wage rate is lower, a
meaningful expansion of NREGA would have required a much larger
allocation than the Rs. 2350 crore increase over what was spent in
2008-09. Similarly, the Rural Health Mission has been allocated only Rs.
1730 more than what was spent last year. It is unfortunate that the
Finance Minister has given his stamp of approval to an increase in the
price of foodgrains by Re. 1 per kg for Antodaya families and a cut in
the allocation of food quotas by 10 kg to BPL families in the name of
the Food Security legislation. None of the promises made to women
including the widow pension scheme has received increased allocations. 



The series of direct and indirect tax concessions in the wake of the
global economic crisis has led to the tax revenue forgone reach as much
as Rs. 4.18 lakh crore in 2008-09. Rather than withdrawing these
concessions to enable greater resource mobilisation and spending in
critical areas, the Finance Minister has chosen to extend these
concessions for the entire financial year of 2009-10. The abolition of
the Fringe Benefit Tax and Commodities Transaction Tax will also
adversely impact tax mobilisation. Despite the welcome increase in the
Minimum Alternative Tax levied on corporates from 10% to 15% of their
profits, the Budget is revenue neutral on the direct tax front and
direct tax revenues are expected to increase by 7% only, which is much
less than the nominal growth of GDP. 


The Government expects to garner Rs. 35000 crore from the sale of 3G
telecom spectrum, confirming the massive scam in the allocation of 2G
spectrum during last UPA Government, which led to a loss of Rs. 60000
crore to the exchequer. 


The Budget far from meeting the requirements of the people will further
widen the gap between the haves and the have-nots. The CPI (M) calls
upon the people to be prepared for struggles to protect and improve
their livelihoods.

eom