NEWSLINKS
BUDGET 2000 LIVE!
BUDGET ON REDIFF
D&B BUDGET SPL
ECONOMIC SURVEY
RLY BUDGET
BUDGET: RUN-UP
BUDGET PROCESS
BUDGET HOTLINKS
Y2K BIZ FEATURES
INDIA & THE WTO
GOVT&ECONOMY
SPECIALS
INTERVIEWS
COMMENTARY
CREDIT POLICY
BUDGET 1999-2000
USEFUL INFO
ARCHIVES
SEARCH REDIFF

'This Budget is retrograde'

BUDGET 2000

Dr Subramanian Swamy

The 2000-2001 Budget presented today is bureaucratic in conception, retrograde in consequences and represents a major setback to the economic reforms. The Budget does not address itself to the fundamental problems of recession in the industry, the growing bottlenecks in infrastructure and the sharp decline in the rate of investments.

On the contrary, the proposals in the Budget will further worsen the economic situation. Nor has the finance minister dealt squarely with the looming problem of financial solvency and debt trap, and instead through bureaucratic measure has sort to hide the gravity of the situation by putting it under the carpet. As a consequence, the year 2000-2001 will one of gloom.

Defence allocation has gone up, but for what? In the capital account there has been only a minor increase after deducting for inflation, but most of the allocation has gone for pension and compensation for those killed or maimed in Kargil.

I had expected that since the last two years the rate of domestic savings had steeply declined, therefore, there would be major tax cuts for the middle-class and professionals. But there is none. Some minor measures are there in the Budget for senior citizens and for pensions only.

The maximum retail price is being raised by 15 per cent, not reduced. Please, see para 69 of the FM's speech. Furthermore, custom duty has been raised to 35 per cent on agriculture goods, horticulture products, dairy products, processed foods, and marine products. This only further confirms what I said that this Budget is retrograde.

It depends on the machine. For the IT sector, there has been 5 per cent point cut. Generally speaking, because of the WTO we shall have to keep customs duty below 40 per cent, but in the Budget there is no recognition of the same. According to the memorandum submitted with the Budget documents, there appears to be no reduction for basic custom duty for machines other than those in the IT sector, telecom and the entertainment industry.

There is nothing for the NRIs. In fact there is very little for FDI which has been declining in the last two years. The peak was in 1997 of $ 5 billion when China was getting $ 45 billion annually.

Why only the salaried class! This whole Budget is a exercise in deception, fudging, and fraud on the public. Take the case of the excise so-called restructuring. It is going to cost a huge cascade effect on prices yet the FM has hidden it even in the Budget documents.

This is the first time that the memorandum explaining the provisions in the finance bill do not give an estimate of how much tax is being mobilised.

Only after you go to the market you will know. The Bombay Stock Exchange has already got a wind of the reality.

Dr Subramanian Swamy, president, Janata Party, is a former Union commerce minister.

Budget 2000 Live! | Budget on Rediff | Dun & Bradstreet Budget Special | The Run-up
Budget Process | Budget Hotlinks | NDA Government & Economy
Ministry of Finance: Economic Survey 1999-2000 | Budget 2000 document

Tell us what you think of this Budget 2000 coverage