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G. Srinivasan

THE Budget for 2003-04 will be "a soft" one as the ruling party is only "pampering the trading community and the middle class and talking about reforms of the tax system", as outlined in the Kelkar Committee reports, says the CPI(M) leader Mr Somnath Chatterjee.

In a pre-Budget interview to Business Line, the veteran Parliamentarian did not conceal his revulsion to the Kelkar Committee report which, he said, would, in the name of doing away with tax exemptions, enable the authorities "put the pressure on the common people and not on the affluent sections".

Mr Chatterjee said all the grand projections of the economic growth made by the Planning Commission and the authorities for the Tenth Plan would come to nought as the country is in the midst of a recession.

"There is no visible prospect of any remarkable change as the Government has been trying to project," he said. The Tenth Plan document, he said, did not delineate upon how the high growth rate could be achieved and "we have no faith in the Plan projections in the absence of massive public investment in infrastructure". He said industrial sickness and industrial closure had become rampant.

Mr Chatterjee sought to know "what is meant by reforms and who are their intended beneficiaries? Are they meant for a minuscule section of society? Small-scale industry is under greater attack due to reduction in reservation of items meant for its manufacture. There is loss of employment, closure, sickness.

"Agriculture is in the doldrums and farmers in many States are committing suicide because they are not getting proper price for their produce. In the handloom sector, there is severe competition while jute is under attack by synthetic lobby. In tea, we are not able to face the competition. In which area is the country progressing?''

He asked how "the high foreign exchange reserves of $74 billion" came, about which "there is loud talk. It is all due to portfolio investments and they are sort of temporary phenomenon that could vanish". He said the foreign direct investment was not flowing in productive sector which could provide jobs to Indians.

"The way the working class is being treated in the country is a matter of serious concern for they have no sense of security, contribution to the national asset creation. The government is going to introduce hire and fire policy," he said.

On disinvestment, he said, "valuable assets of people are being sold away for no apparent benefit to the industry and to the common people. Disinvestment proceeds are being utilised for purposes other than they were promised to be utilised for, augmenting the Consolidated Fund of India.

"There is neither any redeployment of workforce; nor there is any new industry and there is no modernisation of Indian industry. If you see the document of disinvestment, all tall promises that have been made were only to hoodwink the people."

Pointing out that "we have not much faith in the so-called budgetary exercise," Mr Chatterjee said there is "complete chaos and lack of initiatives, even as this Government is spending money on nuclear, controversial defence deals and other matters which have led to serious corruption".

Asked about his reservations for foreign capital and his continuous wooing of the same for West Bengal as Chairman of the State Industrial Development Corporation, Mr Chatterjee said:: "I am not enamoured of foreign people coming here, trading, making money and going away. We have investment potentials, set up manufacturing units especially in areas where we don't have technology, bring better technology and managerial practices and generate employment and asset creation for our nation."

On globalisation, Mr Chatterjee contends that "it does not mean annihilation of our national interests and it cannot be at the cost of national interests." He cited how the US and France put barriers to certain imports which affect their domestic industry.

"This is where we are totally oblivious of taking note of our national interests and catering to the needs of the people." Further, he said, if globalisation meant there is a global market, how is it that recessionary conditions continue unendingly in major markets and "what sort of globalisation is this"?

He said that every State today is under tremendous pressure including NDA's favourite Andhra Pradesh. The Centre has several means of raising resources including borrowing from abroad and within, printing money, whereas the States have increasingly narrow choice in raising resources.

"But the States have responsibility even as the wherewithal vests with the Centre. This is the imbalance in our federal set-up," he said adding that "after all, all the States constitute the Centre and the latter cannot wash its hand off in its responsibility towards the States."

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