He places budget in the context of uncertainty worldwide and high food inflation
Union Finance Minister Pranab Mukherjee maintained on Monday that the budget proposals were aimed at addressing the problem of high inflation while giving a push to economic reforms, though there were no “dramatic announcements.”
Speaking to journalists after presenting the budget for 2011-12 in the Lok Sabha, he sought to provide a rationale for his proposals and the environment in which he had to carry out the exercise. “I had to place the budget in a situation where there is uncertainty worldwide [and] high food inflation. Though in terms of percentage, it [inflation] has come down from 20.2 to 9.3 [per cent], but still it is [at an] unacceptable level.”
Mr. Mukherjee was quick to point out that the budget proposals also tried to signal reforms without any dramatic announcement. “I wanted to convey a strong signal towards reforms...reforms not in dramatic announcements but [by] addressing those issues [which can help to improve] governance and delivery.”
As for the measures put in place to tackle high inflation, Mr. Mukherjee said he tried to address the problem by allocating resources and including schemes to augment pulses and edible oil supply. “We have taken special programmes, about six to seven programmes, to be implemented under the Rashtriya Krishi Vikas Yojna. I have allocated resources, and schemes are being worked out for pulses, edible oil, providing fodder for the cattle, green revolution in eastern India…We have to remove the supply bottlenecks and, therefore, the agriculture response should be to improve the supply bottlenecks.”
On taxation, he said the use of information technology in dealing with issues of income tax would “bring [about] revolutionary changes in the tax compliance, tax administration.”
The budget, he said, sought to move ahead on the path of fiscal consolidation by keeping a check on expenditure and reducing fiscal deficit, which he proposed to bring down to 4.6 per cent of the gross domestic product in 2011-12 from 5.1 per cent in the current fiscal, as per the revised estimates. “I have conveyed the message in this budget that we shall have to resort to fiscal prudence, and fiscal consolidation should take place.”
Delay in GST
On the delay in the implementation of the Goods and Services Tax (GST) to revamp the indirect tax regime, Mr. Mukherjee said: “It would be possible [to implement it] with the cooperation of my colleagues in the States. We would be able to move towards GST… It is not just for a casual mention [in the budget]. We shall have to go to GST and we shall have to address the concerns of the States. I am not insensitive to the concerns of the States.”
Keywords: Union Budget 2011, Indian economy
>Pranab Mukherjee has presented one of the most disappointing budgets in recent times. It looks like a total washout, bereft of any positive or beneficial features. He has followed the most beaten track of twiddling with the tax rates and surcharges, reducing half percent here, increasing 2 percent there, trying to look intelligent, but falling flat in the final analysis. The FM has thrown some crumbs to the middle class in the form of increasing the tax threshold by a paltry Rs.20,000/-, which is more an insult than a benefit! He seems clueless on curbing inflation and bringing back the black money stored in tax havens by unscrupulous politicians and businessmen, which by itself can reduce the tax burden of a majority of Indians and let them live comfortably. But we must credit our Ministers with a sense of humour. Male seniors / female seniors have different age limits in the financial budget and in the Railway budget ! Truly, Dr. Singh seems to be presiding over a circus cabinet. We need younger and fresher minds to run the show, especially Finance Ministry. The current crop of ministers appear to be over the hill.
There is nothing new in this budget of 2011-12. In this time of political untrust Finance Minister should have presented a budget which can rekindle the faith of the common people in the government. Pranav Mukharjee was expected to present something special to tackle the inflation, but he didn't meet the expectations of the commonman.
Without reducing the excise duty on oil, we cannot control infaltion. Moreover in the name of controlling infaltion our Hon Fin Min has increased the price of basic items like Coffee, Tea, Notebooks, Hotels, etc.
GROWTH-INFLATION MISMATCH:: What is the use of all this high growth when most of it is wasted, inefficiency or simply looted out of the country ? Taxes are being collected in a nonsensical hurry, even before the money had a chance to filter through the economy. And the rest is siphoned out by scams and corruption. That is why the inflation is so high in India. China has 10 % growth rate. But its inflation rate is about 5 %. India has 8.5 % growth ( and brags about it ), but its inflation is 14 %. - Does this say something ?
This budget reflects the anti-poor people approach of Congress Party. We will keep paying them in form of taxes, the thieves and scamers will remain continue us. Our patients will continue dying at the gate of hospitals and will die due to having fake medicines but these politicians will remain alive looting the People of India. I think people of India should protest to restore true democracy where the government is dedicated to serve its people rather stealing its money and keeping them to die at all fronts. Present ruling class has failed to fulfill the promises made to Indian people.
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