Lok Sabha

February 9, 2017

Kalyan Banerjee speaks in the Lok Sabha on the Union Budget | FULL TRANSCRIPT

Kalyan Banerjee speaks in the Lok Sabha on the Union Budget | FULL TRANSCRIPT

Respected Speaker Madam, we are opposing the speech of Budget 2017-2018. Our leader and the Hon’ble Chief Minister of West Bengal Mamata Banerjee gave her reaction on the Budget. I start my speech quoting her: “A controversial budget 2017 which is clueless, useless, baseless, mission less, action less. Heartless”.

Fortunately, I had the privilege to work with our Hon’ble Finance Minister in few matters as his junior. But I have never seen him as heartless as earlier which has been done in the Budget speech.

The Budget does not reflect any road map for the country or for the future. The present government has lost all credibility by reason of number of steps including demonetisation that affected public at large of this country.

There is jugglery of words and figures in the Budget. The biggest failure of the government is that the Budget is silent in respect of costs and benefits of demonetisation. The Hon’ble Finance Minister did not give any figure in the Budget speech on two points.

One is how much black money has been extinguished. Second is how much the exercise cost the nation. The Budget has neglected primary education, ICDS and nutrition projects. The Budget also did not speak that how much amount of black money is lying in foreign banks.

In other words there is not a single word about offshore accounts in the Budget. The Budget speech demonstrates a clear admission of the government that private investment is in the doldrums.

In 2015-16, the Government has created 1.5 lakh jobs which is far short from their promises of creating two crore jobs in a year. Gross fixed capital formation (GFCF) is a widely-used measure for accounting for private investment. According to the Economic Survey, growth of GFCF in financial year 2014 was 4.9 per cent; in financial year 2015 it was 3.9% and in financial year 2016 was – 0.2 per cent. This is how much it has come down.

Micro, small and medium enterprises (MSME) are the low-cost producers and job-creators. Demonetisation has forced nearly 80 per cent of MSMEs to close down. Most MSMEs are not companies. They are proprietorships or partnerships. From 5.97 lakh to 6.9 4 lakh companies file income tax returns, and amongst them, only 2.85 lakh make profits. Cutting the corporate tax rate for MSMEs from 30 per cent to 24 per cent will therefore benefit only 2.74 lakh MSMEs. If the taxable income is modest the benefits are also modest. It will do nothing to increase sales or create new jobs.

On the other hand, if excise duties or service tax were cut, it would have boosted demand and revived the many MSMEs that have shut down. Deputy Speaker Sir, almost 12 lakh power looms of Maharashtra have been closed down. The diamond industry in Gujarat, due to demonetisation, is in such a bad shape that Bengali diamond-cutters have been forced to return to their State (that is, West Bengal). Workers have returned from Gujarat, Kerala and Mumbai due to demonetisation and the industries have closed down.

The supply chain of leather industry in Bengal is in shambles. So is jute, tea, textile, handloom and handicrafts. Fact remains that Moradabad, Ferozabad, Meerut known worldwide for their glass bangles and sports goods are in miserable shape with maximum units closed.

The unorganised sector of India provides 80 percent of jobs and demonetisation has destroyed that. It is unfortunate Hon. Finance Minister that there is not a single sentence in your speech in respect of the unorganised sector; it fully establishes the Govt’s heartless attitude towards the unorganised sector itself.

The Budget has given credit to farmers, which will never reach them because 92 percent villages have no bank in India. The government’s demonetisation policy have already destroyed the cooperative system by not providing them cash which is the mainstay of farmers for credit.

Now the government is playing jugglery of words. While you have given some tax relief somewhere, you have quietly put some surcharges somewhere else. We can understand very well that when you are giving with one hand and taking away with the other also. It is shocking that when the NPAs of banks have reached Himalayan heights (Rs 6 lakh crore), the Budget has allocated only Rs 10,000 crore only for capitalisation of banks. This is really a cruel joke for the banking sector.

Investors are ineligible or unwilling to borrow and banks are unable to lend. Therefore credit growth to all industries is at all time low and turned negative in October, 2016. Let us look at the NPA situation of the Public Sector; let me give a few figures.

As on March 31, 2014, gross NPA was 4.5%. on March 31, 2015, it was 4.6%. On March 31, 2016, it was 7.8%. And on December 31, 2016 it was 9.1%. As on March 31, 2014, loan accounts that were performing have become Non-Performing Assets under this present government.

Budget 2017-18 has not given any benefit to people of any class of this country. There are only big words about the poor people, farmers, of people of remote areas. I also come from rural area and represent rural people.

This year there has been very good cultivation, but the farmers are not able to sell their crops due to non-availability of cash. You may speak about the cashless society, but you cannot change a 70 year old system with the stroke of a pen overnight. We support cashless, but not in one day or two days, it will take time. Our rural economy is based on cash flows, we cannot shut our eyes to the reality.

Therefore Deputy Speaker Sir, the Budget 2017-18 will be remembered for not extending benefits to the people of this country, and it will be remembered as a damage control Budget. India will muddle through another year hopes belied and aspirations unfulfilled.

With this I am ending my speech. Thank you Sir.