Better Late than Never

If I do not mention the Indian Union Budget in my Blogs, that goes incomplete. Better late than never – as the saying goes, I took some time to go through the same in bit of detail. I am neither economist nor a person with finance background. I am an ordinary citizen of India who expects or believes that the Union Budget presented every year is doing some good for me or my country.

Mr. Chidambaram is also not an economist or a man with commerce background. Surprisingly, he got into the shoes of the Finance Ministry and he makes a mockery of the same while all the media going gaga over it! With elections expected later in this year, it was obvious that this year budget will have all populist measures than the so-called reforms. It is needless to mention that the major highlight of this budget is the loan-waiver for farmers and the IT tax restructuring.

Mr. Chidambaram has the unique track record of aiding the dishonest in the name of novel ideas of reforms. Earlier, he introduced the scheme of VDIS (Voluntary Disclosure) in which violators of income-tax were allowed to go scott-free let lone rewarding the genuine tax-payers! Such schemes only encouraged people to cheat the Government expecting it to be repeated. To implement such schemes, people would keep them electing, thus ensuring the safety of their political future!

Hence, it was not surprising the loan-waiver idea from PC this time that would pose a major moral-hazard. If one gets deeper into this issue, it reveal such a dangerous picture, I am worried whether the common people are aware of the consequences or they playing an ostrich (dipping the head in the soil) to this issue?

The amount that will be waived is pretty huge. The ministry had not taken any pain to explain or even cared to tell us where this money will come from or how will it be generated. All of us are aware that this amount is not being given from the pockets of the ruling party or from any other party that expects to rule the country. To expect such sorts is the height of foolishness! As a common man, I am convinced that this amount will be recovered in one form of tax or other from us, the people, only.

The Government has been sleeping all these 4 years waiting for the situation to go from bad to worse and at the vague end of their reign, declare such populist measure without a strong backup plan. It has been the habit of Congress to spoil the people of India in the name of sops and subsidies. They failed to teach people fishing instead kept on giving those fishes. This sort of socialism had spoilt the country and made us the laziest one still; they prefer to follow this path.

This loan-waiver makes it clear that the problem is forthcoming elections and not the agricultural sector. Since 1990s, a sort of stagnation is found in this sector. No diversification is applied. Stagnation is observed in fertilizer consumption. Added to the woes of sudden change in the monsoon pattern, farmers are helpless. Subsequent Governments have failed in implementing the Drip irrigation systems and water conservation systems instead went on giving free power to draw water from the Earth to the maximum and causing damage to the nature. This subsidy value has gone to 7 folds (from 400 crore to 28000 crore) in Haryana alone. Imagine if we combine all our states, what will be the magnitude of the so-called subsidy? Who pays for this?

The loan waiver would benefit hardly 4 crore farmers out of 11 crore of them. Hardly 22% of the farmers would get benefited (and God knows how many of them are well-off and politicians themselves). Since the time banks are nationalized, politicians abuse the banks to avail loans without an intention of paying back. Banks end up writing off such loans adding to the burden of common man. Same is the case with co-operative banks also. Under such circumstances, a common farmer had the remote possibility of getting loan from nationalized banks. Only those with the political clout could have availed them.

It is certain that those with political clout hardly had the need to avail a loan but they availed and they are getting exemption. The genuine common farmers had availed loans from private parties and they are suffering. Accepted! It’s a great deal to waive off the loans for this year. What will happen to those who had genuinely paid back the loans availed. Will that money be returned back to those farmers? What will happen next year? Will the loans be waived off in a periodical manner? How will the situation of farmers be improved? Does the Government have any action plan for this?

These rhetorical questions remain unanswered by the Government and the so-called media with (out) any responsibility is going gaga over it!

PC hailing from Tamilnadu had a soft-corner (?) for this state always only when reads out the kural scripts in the budget. He might be spending more time on identifying the right kural (couplet) than to finalize the budget. In 2004 budget, he mentioned about the water scarcity in Tamilnadu and floated a unique thought of desalination plant (without doing a cost viable project analysis). Four years have gone, all of us have forgotten, however PC woke up from his slumber and declared another 300 crore would be given if this project works out. Here again, there is no concrete plan, none of us know who is working on this project, If so, when is it expected to get completed, what will be the benefits, etc., Yes. This being the election year, this has to come in the memories of PC and he had declared it. By simply declaring on paper, he depicts a picture as if half the work is done. Will the other half have to wait for next term election?

The congress boasts itself of concerning for Aam Aadmi but fails to recognize that aam aadmi needs potable water, sanitation facilities, primary education and a decent shelter. He is not greedy if he expects to turn into a middle-class man. Do we work towards this?

The infrastructure department had slept for all these 4 years. We still count on roads & rails built by the British and perhaps ours might be the slowest train running in the world. The conditions of the highways are pathetic. Courtesy, previous government, some of the cities are well connected, however, this is far from the requirement.

As a part of appeasement measures of minorities, they were granted additional 7300 crore. I am not sure what they mean by this? Are the Hindus not entitled to any sort of treatment from the Government but for the step-mother treatment they receive?

In all fairness, I vote for expanding the base of the income tax but with reduced burden. Service tax is another problem. If I watched cable TV, I pay service tax, If I got my TV repaired, I have to pay tax, If I availed mobile services, I have to pay tax, If I surfed on Net, I have to pay tax then why not lawyers are brought under this net? Is this because PC’s family and most of the politicians are in this profession?

I can keep on writing but I am sure hardly this would matter. I have vented out my feelings in this blog. I do not know whether this will reach the right one and am not sure even if it does, something will happen.