Millennium Post

Expect budget to be a bitter bill: Jay Panda

Expect budget to be a bitter bill: Jay Panda
Biju Janata Dal (BJD) MP Baijayant ‘Jay’ Panda in a chat with Millennium Post spoke about his expectations from the union budget from the Narendra Modi-led government, which will be presented on Thursday in Parliament by finance minister Arun Jaitley. 

‘The approach of the union budget will be similar to the rail budget. In the last one and a half months, prime minister Narendra Modi has been following a particular pattern he has been explaining the bitter pill concept and has been taking steps like increasing fuel prices and even rail fares. Rather than taking populist measures he has been taking hard and tough decisions. We expect that the union budget will be similar,’ said the Lok Sabha member from Kendrapara.

‘Also everyone knows that the Indian economy is in a mess. The fiscal deficit is very high which is pushing inflation and rupee devaluation. Every time there is a disturbance in West Asia such as the Iraq crisis now, our fuel cost goes up triggering another round of inflation. The signals this government has sent out even without taking any steps are positive and have generated a positive sentiment over the last six weeks on the stock market,’ he added.

Talking about the future, Panda said, ‘Now real steps need to be taken to free up the economy. That is going to be tough, because again like Railways you have a lot of subsidies in the general economy and a lot of poor people are dependent on that. As they take the tough steps of controlling cost there will be a reaction.’

Adding to the expectations from the budget he said: ‘One of the things all thinking people are expecting is that the government will revive a focus on cash transfers. Unfortunately, Aadhar got caught up in a lot of controversy but the idea is correct. The idea is that if you have biometric verification and you directly transfer the cash then you save a lot of money. If you remember in Rajiv Gandhi’s time, out of every rupee the government spent only 15 paisa reached the poor. Today that figure is 27 paisa. The Planning Commission figures are that out of every rupee they spend only 27 paisa reaches the poor. Lot of money is going as administrative cost, leakage or corruption .That has to be controlled.’

‘The way to do that is today (Wednesday) the Economic Survey in one of its key aspects clearly says that the subsidy regime must move from price control to income support, because prices ought to be determined by supply and demand. To pretend that something is low price is just wrong. For example we are pricing electricity low but we are not able to supply power. There is a great deal of leakage and corruption. Rather the focus should be to let supply and demand determine prices, but income support in way of cash transfers can be given to poor citizens so that they can afford to get those things whether it is diesel, petrol, gas, electricity, health, education or other things. I expect that the finance minister will actually give a big push at this front,’ added Panda.

‘The challenge remains that the BJP itself had been criticising Aadhar. But there has been an indication in the news reports that Narendra Modi had been supportive of Aadhar during his chief ministership in Gujarat and if that is true then they can use that to start cutting cost without affecting lives of the poorest people. So that should be the biggest thrust,’ he suggested.
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