December 31, 2018
Saugata Roy speaks on The Supplementary Demands for Grants for 2018-19
Madam, I rise to speak on the second batch of the Supplementary Demands for Grants for 2018-19.The total amount asked for is Rs 85,000 crore, of which the actual outgo will be Rs 15,000 crore and rRs 70,000 crore will be made by savings from other sources.
Now before I go deep into the supplementary demands I want to mention that these are being taken forward to Parliament in the backdrop of BJP’s lose electorally in five states. They have lost to Congress in three states. Modi Ji has spoken about Congress mukt Bharat. But because of the wrong policies, the Government is taking the party to BJP mukt Bharat.
However, why did this happen to the BJP, is a question of the political economy. Mr Arun Jaitley under his charge allowed or initiated two cruel steps. As Arvind Subramanian, the former chief economic advisor said, one was Demonetisation and another is the hurried implementation of GST.
Demonetisation took the common people under terrific strain when they had to queue up before banks and also the hurried implementation of GST put us in a problem where businessmen were not ready to confirm the GST.
We know that due to demonetisation hundreds of small industries closed down. I have been repeatedly asking for the government figures of how many people lost their jobs due to the cruel step of demonetisation. The Government has not been able to come forward with an answer.
Further, I want to ask the Finance Minister whether he has got any assessment of how many small businesses have closed down due to the hurried implementation of GST. I do not think that the Government would come forward with this.
Madam, I may say that in general, the economy is in a very bad state because the growth in the last quarter of July-September was 7.1 percent; there is growth slow down. This quarter of July-September has shown the lowest possible growth at 7.1 per-cent. The Government which used to speak about double-digit growth does not speak about double-digit growth anymore.
The economy is in difficulty. There is slow down in growth due to tight financial conditions, the agricultural sector is stressed and slower exports amidst global growth conditions. It would be ambitious to expect any reforms to pick up the economy at this stage.
I also want to say that the agricultural sector is the worst affected. Farmers are committing suicide all over the country and so far the Government has not given any scheme which can provide hope to the farmers.
Madam, in the midst of all this the Government is using the Niti Aayog to fudge figures. They have said that the new release of GDP series by Niti Aayog shows a big difference. Mr Subramanium remarked that Niti Aayog are not technical experts and they are nobody to give back series GDP growth figures. Madam, I was speaking about GST earlier; our party Trinamool Congress has always said that we are for one tax in the whole nation but we started with multiple slabs and now after almost a year and half of GST implementation, the Finance Minister is talking about cutting the number of slabs of taxes to three. He has recently reduced – in the face of coming elections – taxes of vital commodities; but cement still remains at 28 percent. It makes construction costly in this country.
Madam, we should have an independent fiscal council to monitor the accounting in real time to find out the actual deficit, because the figures the Government is giving out is often misleading. Having said this, I would like to point out that out of the Rs 85,000 crore, Rs 41,000 crore are being given to banks to recapitalise themselves. If I may say, what is the biggest blunder of the Modi Government? The biggest blunder is demonetisation and the hurried implementation of GST. What is the biggest failure of Mr Jaitley as the Finance Minister? I honestly say that the failure to revive the banking sector. He has given the acquisition cost of RBI stake in national housing bank and recapitalisation of public sector bank through issue of Government securities through Rs 41,000 crore. Earlier the Government had given Rs 65,000 crore in the Budget; add 41,000 crore, it is Rs 1. 05 lakh crore. Out of this, some money has been spent; so actually Rs 83,000 crore are being given to banks to recapitalise themselves and to bring them up to base three norms.
The problem is not there Madam. You will know that there is a conflict between the Reserve Bank of India, a statutory organisation and the Government. The Reserve Bank of India has given the most prompt corrective action on 11 public sector banks. They are not being allowed to lend. They have been told that no public sector bank expansion. The MSMEs are not getting any loans, the banking sector is in doldrums. Madam I will give you one figure, you will take interest in economic matters.
The Finance Minister replied on December 21, 2018. What is the total non-performing assets of the banks, NPA was Rs 2,51,000 crore on December 31, 2014 when this Government came to power. In four years, it came upto Rs 9,62,621 crore. It has been a mammoth, gigantic figure. The Finance Minister is saying that there are some green shoots. The NCLT, National Company Law Tribunal is passing over some assets to the biggest bidder. For instance, Vedanta has bought over Electrosteel; Tatas have bought over some steel company. This is only a small part.
Madam, as somebody said earlier, that the Finance Minister is known to be a big talker. He is the main defender of the beleaguered Prime Minister, so he will always say these things.
I’m telling you that Reserve Bank of India did Asset Quality Review under whom? Under Raghuram Rajan, whom this Government forced to leave. He was the Governor and Asset Quality Review was done during his time. Why did this Government ask the Governor to go? The best economist left.
Madam, lastly, the main problem, why did Urjit Patel resign? Urjit Patel did come to our Finance Committee. I’m not free to disclose what all he said but was impressed as the man was polite and humble and he had a spine. Few days after our meeting of the Finance Committee, Urjit Patel resigned much before his time, A new Governor has been appointed.
Now what is the bone of contention? The Government has shaken all the top institutions. RBI is in doldrums under the attack of the Government. I’m not talking of the CBI, which is in greater doldrums. I will discuss CBI on another day. So, what really happened, Madam? The Government wanted to lay their hands on the golden pot with RBI. What is that? They have got a reserve of Rs 9 lakh crore. The Government says that if they get more reserves from the RBI then that will be very convenient for them to make up for the huge non-performing assets of the banks. Urjit Patel resisted and he had to go.
Any effort to curb the autonomy of the RBI will prove to be suicidal to this country and this is what the Government is doing and that’s why they want Rs 41,000 crore. Next, they will say that we have got so much money from the Reserve Bank of India. They are destroying the very basis of the Parliamentary system of India and specially RBI, which has been in existence from 1934 and the RBI Act is being attacked.
Another major failure of the Government is in regard to finding a private sector partner for Air India. Nishikant Dubey said Air India is operating in profit. What does it mean? Rs 50 thousand crore is the total debt of Air India. Financial turn around… they are not prepared. Madam, my constituency covers the Dumdum Airport and now Jet is reducing the routes drastically. From 25 flights in Kolkata, they have reduced to 11. Our Government is now giving Rs 2345 crore for Air India, which is not sufficient. We need a turnaround plan, we need a strategic partner. But, the government is lacking the capability to find a strategic partner for Air India.
With two more points I will conclude. I will not speak at length on the economy of our own state. I will only say that West Bengal has been able to double the farmers’ income in this period, whereas the Government wants to double it in 2022. I am saying the Government has found a solution for providing minimum support price to the farmers. Farmers in Mandsaur in Madhya Pradesh were shot dead when they were agitating for wages. The farmers’ problem, the suicides, their distress is the biggest problem in the country and this government has not been able to deliver.
This government just stopped giving NREGA money to the states. In West Bengal, the CM has said that we shall give NREGA money on our own even if Centre does not come forward. But, is it fair to deny the legitimate share of NREGA funds? No Madam, it is not. I would request the FM to bear the burden.
When demonetisation happened most of the ministers deserted the Prime Minister. But, he (the FM) came back from surgery and in such a difficult situation he used to write blogs everyday from his glass-closed chamber. Why? He is fond of Mr Modi, and wants to defend him. But, how can you defend the indefensible? The government which has dropped the economy to its knees cannot be defended.
Madam passing supplementary demand is part of constitutional duty. It will be passed. No government can run unless there is appropriation from the House. But, I will point out and draw your attention to the fact that the economy is in doldrums. As a very senior member of this House, who has also worked in the agricultural ministry,
I want to draw your attention and ask you to pull up the Government to pull up their shocks and revive our banking system which is in true difficulty. Banks are not being allowed to lend. RBI is saying prompt corrective action and Nirav Modi, Vijay Mallya, Mehul Choksi, Lalit Modi are flying away. Two Modis have flown away and I do not know about the third, Madam, when he will have to fly away. Please rescue the country from the torture, from the attacks of the Modis.
Thank you, Madam.