At a point in time where not just India, but the entire world is grappling with the issue of food shortage and escalating food prices, especially owing to the worst drought that has recently hit China (affecting eight major wheat-growing provinces that account for around 80 per cent of the countryâs total wheat output), and at a point in time wherein black money and corruption have taken up gigantic proportions, the least that was expected of our honourable Finance Minister was a few bold steps to arrest both the issues. To tackle the impending food crisis, most governments across the world are planning and drafting policies to control the expected food shortage and the anticipated food price hike. West Asian countries are stocking up grains, while countries like Iraq have already placed orders for 400,000 tonnes of wheat grain from the US. Following the trend, even Jordan, Lebanon, Algeria, Tunisia and Saudi Arabia are exporting grains and Russia has even announced a complete ban on food grain exports. In this light, whatever our Finance Minister announced in his Union Budget 2011-12 had no meat with respect to restoration of food grain stock; neither was any attempt made to address the expected inflation that may creep in within the next few months. Leave aside announcing new plans to enhance food production and modernizing the dilapidated godowns, the FM didnât even announce any concrete plans for speedy implementation of those agriculture development initiatives that were announced in the previous budget!
What he did instead was to call for Lord Indra to shower his blessing to ensure that agriculture productivity is not hampered due to inadequate rainfall. Of course, other than praying for Lord Indra, he also committed a few hundred crores towards pulses, milk, eggs, vegetables and other agri-commodities, but then provided no support system to boost their productivity and irrigation. And it is not that this is fact is unknown to him that China has dramatically improved its irrigation systems since the last couple of decades and is investing $2 billion annually to upkeep the standards. Additionally, this year, the Chinese government is planning to invest another 20 billion yuan ($293 million) for improving water irrigation and safety projects. And all this when around 50 per cent of Chinaâs arable land is now irrigated â in comparison to just 30 per cent of total arable land in India. No wonder, our gross agriculture output is still a mere 40 percent of that of China! That apart, in his address, there was not even a single occasion where our FM announced any concrete plans to bring a second round of green revolution, an issue has almost become a national imperative now.
Moving from agriculture to the second issue that has been haunting the country all-year round â corruption and black money. It requires no statistical analysis to establish that corruption and scams can only be addressed by a strong judiciary and judicial reforms. Again, in this budget, as a sign of mere tokenism, Rs 1500 crores has been allocated for the judiciary, which includes setting up of rural and e-courts. No announcements were made to provide courts with special powers or creating special courts to fasten the judicial process. Same goes for black money. To address the whole issue on black money, the FM announced a five-fold strategy, but no strategy to get back the money already stashed abroad. For records, itâs primarily due to corruption and a perforated judicial system that our country has managed to stash an obscene figure of 1.4 trillion dollars in various tax havens. In fact, a brief glance through the budget speech indicates that Pranabda spoke six paragraphs on black money but found it inadequate to draft a single para to contain it, or to bring back the money from tax havens.
Amidst this entire half-backed and gloomy policies announcement, what came as silver lining was the noble move of direct cash subsidy. Disbursing subsidy in the form of cash will not only reduce leakages in the chain but will also allow the subsidy to reach the right target audience. This should act as a strong foundation for a clean pilferage-free future. The next announcement that brought in some sign of relief was the access of one lakh crore rupeesâ credit facilities to farmers at just 4 per cent interest. But then, as it happened during the previous farm loan waiver scheme, there is a high probability that this gain will get cornered by the rich and big farmers and the poor farmers will remain marginalized. As such, the fact is that a poor farmer is subject to northwards of 12 per cent for his loan, whereas in cities, weâre able to get car loans at 8-9 per cent. What a dichotomy and what a shame!
Finally, there has been an intense debate that this budget has been biased towards the male community as tax exemptions have been provided only to them. It is unfortunate that the popular media focused on tax concessions as a key component of the entire budget, while such concessions help only the top 2% of the population. Incidentally, this is the very same population which also forms a majority of the television audience, and also are the potential tax payers. By doing this, the key issues which affect the nation as a whole got conveniently sidelined!
And at the end, what came as a shocker was the FMâs announcement of the creation of a new very-senior citizen category to provide them with exemption and concession. The fact is that there are very few fortunate Indians who would live up to the 80s leave alone the 90s as most Indians either die well before reaching this age bracket or spend their entire lives on hospital beds waiting for death. For records, we have around 17 per cent of people who die before the age of 45; any Indianâs average life expectancy is just 64 years. Also, we are a nation where the majority constitute the working class and thus retire at the age of 60 with hardly any scope for further income. Thus, such concessions would only benefit the super rich class, where people manage to live longer and have wealth and income that comes under the tax bracket.
Dear Pranabda, in a budget where you provisioned less than 0.5 per cent of the entire budget on health, how can you expect people to live till 80 to avail of those benefits? You should have first given a way for Indians to live till the age of 80, before declaring tax concessions for them.
- 04 March 2011 |
- Dr. Arindam on Indian Economy