Mr.
Deputy Chairman, Sir, I am grateful to the hon. Members
and, especially, the Leader of the Opposition for initiating this
discussion on the Finance Bill. The Leader of the Opposition has sent me a note
saying that he may not be present to listen to my reply because of other
commitments, and I quite appreciate that. He said that there must be a
reform of the mindset. He was referring to the Ministry of Finance but I take
it as a comment on the whole system of governance. I would support him
in the argument that mindsets have to change. We no longer live in a world
where we can say that we are isolated from what is happening120 in the rest of the world. The
theory of decoupling India's economy from the rest of the world's economy is140 (1) a farcical theory. On an
earlier occasion, I have explained that we are dependent on imports for
a number of160 commodities
like crude oil, fertilizers, raw materials, minerals, metals, etc. We have to
pay for those imports and we can pay for those imports only if we
export. So, imports are a necessity; exports are an imperative; and a country
which has to increasingly trade with the rest of the world cannot remain
unaffected from what is happening in the rest of the world. We live in a
world where a number of forces are at play.
This
year has240 seen a number of
crises hitting many countries of the world at the same time.
There is a food crisis, there is a fuel crisis, there is a fiscal crisis in
some countries and there is a financial crisis which280 seems to have affected a large number
of financial institutions. (2)
While some of this was anticipated, many countries did not
anticipate this very sharp rise in prices of commodities. But if you read
the Budget Speech, you will realize that320
we had anticipated some of these pressures and taken pre-emptive action.
We cut customs duties; we cut excise duties; we gave relief to Income Tax assessees,
and we promise to take further fiscal and monetary measures if it becomes
necessary.360 So, it
may not be correct to say that we did not anticipate this turn of
events. It is, therefore, important that our mindsets change so that we can
bring to the governance of the economy a set of policies and principles that
are relevant to the modern world. These
principles can only be based on an open polity and420 an open economy. We are proud of our
open polity. We should be proud that our economy is also opening up.
This opening up of the economy was started in (3) 1991 and it has
brought India to a stage where we can legitimately claim that we will be the
fourth largest economy in the world in a few years, and480 that the prosperity of all
Indians will rise as we continue to move up the economic ladder. Even today, we
are regarded by the rest of the world as an important economy, a growing
economy, a dynamic economy, which is the second fastest growing
economy in the world. When you say 'the second fastest growing economy',
you are conceding the first place to another country, but our aim must be to
become the fastest growing economy. At the same time,560 we recognise that growth is not an end.
Growth is merely a starting point; growth is an imperative. But the ultimate
goal is inclusive growth, where we can share the benefits of this growth
with all the people of India. 600
I believe that this Government, in the last four (4) years, and in
this Budget and this Finance Bill, has taken a number of measures to make
growth inclusive, and I shall briefly refer to them after I deal with
the640 specific issues
regarding the Finance Bill. I am conscious that this is the last
stage of the exercise of passing the Budget. I am grateful to hon. Members
who have pointed out a number of aspects of the Finance Bill, and I shall
deal with them.
Sir,
as far Sikkim is concerned, there is a debate that has been700 going on since 1990. It is a happy
conclusion that we have reached an agreement with the Government of
Sikkim. 720 They a Sikkim
Subjects Register. Anyone who is in the Sikkim Subjects Register alone is
entitled to buy property. The same Register will be operated, and those who
find their names in this Register, will be exempt from Income Tax; all others
would have to pay Income Tax. We (5) have brought this amendment to
reflect the agreement. We have taken care to see that we are not
reopening any assessments for any past years; we are making it prospective.800 I do not think we should try to unravel
that agreement. It has taken 18 years to reach the agreement. In
any event, I do not expect to collect very large revenues from even the
non-subjects of Sikkim. I think we840
should let the matter rest there. The Leader of the Opposition asked me why we
are limiting the Income Tax benefit to five years. My answer is that we are
giving Income Tax benefit for five years; they never had any benefit. We are
giving Income Tax benefit for five years to hospitals that are located in two-tier
and three-tier cities. I think the hospital industry is happy that
they will get a five-year Income Tax exemption.
He also raised some concerns about
'fertilizer famine' coupled with fiscal improvements. (6) How can the
NDA Government claim to be fiscally prudent compared to the UPA Government? The
NDA Government inherited a fiscal deficit of five per960 cent and it increased to six per cent
and they closed their innings with the fiscal deficit of five per980 cent. So, after six years of NDA rule,
the fiscal deficit remained where it was. We brought down the fiscal deficit to
three per cent in the year that is ended. Likewise, the NDA Government
inherited revenue deficit of three per cent and it worsened to four per cent,
and when they closed their innings, it was still 3.5 per cent. You inherited three
per cent, you closed your innings with 3.5 per cent and claim to be fiscally
prudent! We have brought down the revenue deficit from 3.5 per cent1080 to 1.5 per cent in the year that is
ended. I think, in terms of fiscal prudence,(7) this Government is the most fiscally prudent
Government in India's history. For the first time, we have set
for ourselves fiscal1120
targets and we will meet those fiscal targets by the end of next year.
The
other phrase that was used was 'fertilizer famine'. Let me assure everyone in
this House that there is no fertilizer famine and there will be
no fertilizer famine. We have enough stock of urea. We produce fertilizers; we
import fertilizers. This Government has given agriculture the highest priority.
This Budget was described by commentators as the green Budget. We will do
nothing to hurt the1200 farmers.
We will do everything on our part to help the farmers. If that means importing
more fertilizers at higher prices, if that means encouraging Indian factories
to produce more fertilizers, and if that means bearing a higher fertilizer
subsidy, every one of that will be done and fertilizer will be made available
to our farmers.
Sir,
another question is1260 (8)
related to the Public Distribution System. We have received the
Report of the Standing Committee on Food, Consumer Affairs and1280 Public Distribution. The Committee has
mentioned in its report that the diversion of food grains meant for the poorest
of the poor is the biggest menace in the functioning of the Public
Distribution System. The report also gives numbers of each State. It will be
embarrassing to many hon. Members because each one of them represents a State. It
will be embarrassing if I read out the extent of diversion in each
State. So, I will not read it out. The point is: it is a shared
responsibility. The responsibility of the Central Government is to procure the
food grains from farmers and allocate it to the States. The responsibility of
the State Governments is to ensure that there is1400 no leakage, no diversion, no
theft and the food grains (9) reach the beneficiaries. This year, there
has been a dramatic turnaround in the food situation in the last three
weeks. As on day before yesterday, we have procured 134 lakh1440 tonnes of wheat as against 76 lakh
tonnes last year on the same date. We have already procured 229 lakh tonnes of
rice as against 209 lakh tonnes last year on the same date. We are very
confident that we will exceed the procurement target of 150 lakh tonnes
of wheat and we will also build a buffer stock and a strategic
reserve. We have enough food grains. I want the people of this
country to know that there are enough food grains in the country
as a whole. There is no doubt on that score at all. As far as the
supply to the Public Distribution System is concerned, there are complaints
here and there from the States. These (10) complaints will be addressed
as our stocks improve. We are not discriminating against one State or
another. Let me assure all the States that enough food grains will be
given. 1597
