New Delhi, Former Finance Minister P. Chidambaram on Thursday termed the budget for 2017-18 a “damp squib” but praised Finance Minister Arun Jaitley for adopting a “tone of moderation” after the demonetisation policy.
Calling it a wasted opportunity, Chidambaram said: “Altogether, I am disappointed that the government has not used the opportunity to push through bold reforms, revive aggregate demand and growth, and devise new strategies for job creation.
“Our conclusion, on reading all the budget documents, was that the exercise has turned out to be a damp squib. But, there are a few positives, which we are happy with. The most important positive is that the government seems chastened after the debacle of demonetisation and has not done anything reckless or disruptive.”
Praising Jaitley, the Congress leader said: “I compliment the Finance Minister on adopting a tone of moderation. It is obvious that demonetisation and its inevitable consequences have demoralised the government.
“They have retreated from reforms and have no answers to the severe challenges faced by the economy. The sections of the people most affected by demonetisation were the farmers, farm workers, manual labourers, the self-employed, artisans and micro, small and medium businesspersons.
“They lost crores in the form of wages, incomes and capital. There is absolutely nothing in the budget for these sections. We had demanded that the government offer them compensation in some form, but the government has cruelly neglected them.”
Chidambaram also said that government has discarded fiscal prudence and violated the FRBM Act.
“In 2015-16, the target of fiscal deficit should have been 3.6 per cent, instead it was kept at 3.9 per cent and the CGA/CAG have reported that it was actually 4.31 per cent.
“Now, again, the target for 2017-18 should have been kept at 3 per cent, but the government has set a target of 3.2 per cent. Analysts, bankers and investors in India and abroad will not take kindly to this disregard of fiscal responsibility,” he said.
Chidambaram also accused the government for being oblivious to the plight of the farming community. “The best signal to the farmer is a remunerative price for his produce. The Finance Minister has not even uttered the phrase ‘Minimum Support Price’ in his speech. The farming community has been totally cheated by the budget,” he said.
Chidambaram also hit out at the government for not creating as many jobs as promised. “The NDA promised to create two crore jobs every year. Their best result so far was 1.5 lakh jobs in 2015-16. There is absolutely nothing in the budget that points to a change of strategy to create new jobs.
“There is nothing in the budget that points to measures to revive flagging growth,” he added.
He also rooted for early introduction of Direct Tax Code, saying, “It is imperative that that the Draft Direct Taxes code be updated and enacted.”