The Budget (General), 2013-14

The Budget (General), 2013-14

 

Thank you, Sir. I rise to speak on the Budget 2013-14. The Economic Survey 2012 had predicted that the Indian economy would register growth of around 7.6 per cent, plus or minus 0.25 per cent, in 2012-13. But now, the economy is expected to register a growth rate of 5.0 per cent in 2012-13. According to economic Survey, Growth rate in Agriculture, forestry and fishing has declined from 5.1% in the year 2005-06 to 1.8% in the 2012-13. Mining and Quarrying from 1.3% in the year 2005-06 to 0.4% in the year 2012-13, Manufacturing from 10.1% in the year 2005-06 to 1.9% in the year 2012-13, Construction from 12.8% in 2005-06 to 5.9% in the year 2012-13, Trade, Hotels, and restaurants, transport and communication from 12.0% in 2005-06 to 5.2% Service. The Growth Rate has declined significantly in almost all sectors during the period from 2005-06 to 2012-13. As a result, our GDP has declined from 9.3% in the year 07-08 to 5.0 in the year 2012-13. Fiscal Deficit increased from 2.5% in 07-08 to 5.01% in 2012-13. Capital formation also declined from 38.1% 2007-08 to 35.0% 2011-12.

Sir, the allocation in case of education, health and woman and child development in respect of the UPA II has decreased from UPA 1 . I would just give you data, in education it was 25.7 %, now in UPA II it is 21.7% . In health it was 19% now in UPA II it is 16.2% . In case of woman and child development it was 28.9 % now it is 25.4 %. There is inadequacy of the Budgetary hike for education sector. 25.7 %, now in UPA II it is 21.7% . The Education Minister informed press recently that a very little amount has been allocated to Education Ministry, and he will make a request to Finance to increase. Nothing has been done.

The Economic Survey also indicates that, the economy has slowed down due to euro crisis, uncertainty in fiscal policy in the United States and weak monsoon. Revenues did not keep pace with spending, the fiscal deficit threatened to breach the target, saving falls and private saving also shrinks. Current account deficit also increased.

Sir, if we take the issue of Infrastructure projects, they are unable to complete due to inconsistent Govt. policies thus resulting huge PSU banks exposure and becoming NPA’s.

While world-wide infrastructure financing is on long term basis, we have no Policy regarding Long Term Low Cost initiatives. Not only this, Sir, we have no proper gestation periodmethodology and combined with improper finance planning which is affecting Thermal / Gas based / Hydel Projects and they are all languishing

In AP alone, I am told, 6000MW equivalent power plants capacity is completed but due to environmental clearance (once given) are kept idle and this amounts to Rs.30,000 Cr of Banks’ Money which is completely stuck.

No proper Coal Linkages/non fuel supplies resulting in power plants being non-starters are posing a major setback to the whole Country,

while Petroleum as well as Gas allocations which are not planned are affecting our foreign exchange outflow.

Sir, This kind of inconsistent approach towards the Industry will have serious ramifications on industries too, be it large, medium or small, and they are all not running beyond 30% of their capacity due to the lack of working capital or power cuts as all this is cyclical.

This would lead to people’s unrest because most employees will eventually default in either housing loans or personal loans which eventually will affect the Country’s ratings.

Sir, regarding Agriculture, this sector is constantly suffering either due to lack of fertilizers or lack of power or no proper financing. In fact no Indian farmer wants any dole as he is a respectable person. Our economy is pushing him to live on doles. Govt can give them a level playing field by supporting proper timely fertilizers, power, warehousing facilities and cold storage centers.

Sir,our farmers in Andhra Pradesh are going on Crop Holidays which was unheard in the past. Why is there no planning to address such issues when we are largely dependent on agriculture? Is there no responsibility to take care of farmer issues? I am sure though this Budget did no mention, at an appropriate time this Government will resort to some quick fix method in this election year to give a Loan Waiver scheme in order to draw votes as well as help middle men as seen by the recent CAG’s report on the earlier loan waiver scheme.

In order to accelerate the growth rate, all the major sectors, Agriculture, Industry and services, have to perform well. India has 1799000 square kms. of Agricultural Land. China has lesser agriculture land area than India and still it produces more agro products than India. Productivity per acre is much more there than in India. I would like to know from the Hon’ble Finance Minister what Government has in mind to increase productivity in agriculture.

Sir,in my Budget speech of last year in this House you may please recall that I have mentioned the way our economy is going and the way industries are going to their banks for Corporate Debt Re-structuring and unless this is not corrected it would hit the healthy banks which have played such a vital role in nation building. They are likely to land on the sick bed which may warrant a Special Banks Restructuring Cell. This will pull our Country’s rating further down.

Sir, the problem is, there is total paralysis of the Govt. in terms of inter – Ministerial relationship, be it in fiscal issues or even internal law enforcement issues. There is total chaos in between Ministries. I had on several occasions cautioned that the way our economy is being neglected there would be very soon large scale NPA’s and as the Manufacturing sector is already down. Very soon joblessness will rise and would Impact inflation. Our Imports and exports amounts to 44% of GDP and capital inflow and outflow represent 108 % of GDP. Sir, Today we are discussing the most important issue, i.e. Finance of the Country and continuous slow down of the economy for the two/three years, which the Hon’ble Prime Minister has also accepted. I would like to know from Hon’ble Finance Minister, what concrete steps are being conceived to move up our economy and to contain inflation. Every Budget time, the Government takes the international crisis as the reason for the slowdown of the economy. International crisis was there in 2008 but in the year 2008-09 our economy was completely insulated. Why our economy today is so badly affected and why is the Government takes the reason of the crisis to the American crisis. India is a big country; we have a big domestic market. We should explore the possibilities to boost domestic market. There is a huge potential for the domestic consumption and market. I wish, the Hon’ble Finance Minister, would tell us what plans this Govt has for this.

Unless India undertakes reforms, our economic growth will be far below potential. At this hour, there is a need to be innovative in terms of policy. But our Government have failed to spell the innovation in the policies in the Budget.

Sir, regarding my State of Andhra Pradesh which was one of the most flourishing States and several years back and was being compared to California / Singapore etc. The State which gave the best talent to the Software world and created so many jobs is today in total backwardness. This Budget has nothing to provide for issues like Power as am sure that many industries would be closing down while many more will become NPA’s. Both Govts in Centre as well as the State are same but apathy been shown in such a way that the state is totally neglected. Earlier we were told that we are a de-coupled economy and hence insulated. Does it now mean that are we now re-coupled economy?

Sir, this Budget has no direction. This Budget has failed to fulfill the dreams of the people of the country. With this, I conclude. Thank you, Sir

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