Chidambaram said that the budget is meant for only 'one percent of India's population that controls 73 percent of the country's wealth'.
The Indian National Congress expressed its dissatisfaction with the Union budget in Rajya Sabha on Thursday lashing out at the government for presenting a "disappointing" budget. Former finance minister P Chidambaram described it as a "budget for the rich, of the rich and by the rich" meant for only "one per cent of India's population that controls 73 per cent of the country's wealth".
The senior Congress leader and former union finance minister outrightly rejected the 2021-2022 budget and called out the ruling party for its "incompetent economic management".
Participating in a debate on the budget, Chidambaram said, "The sub-text is, this is a budget for the rich, of the rich and by the rich.... There is nothing for the poor people of India, who continue to suffer.... This is a budget for those one per cent who control 73 per cent of India's wealth."
He added that the government is in denial about the slowdown in the national economy and further believed that the problem in the economy is cyclical and not structural. "Two years of slowdown before the coronavirus is a reality," he continued.
Chidambaram alleged that the country has witnessed three years of "incompetent economic mismanagement".
"The honourable finance minister took exception to my using the word incompetent. I cannot use a harsher word in Parliament. I am using the mildest word available to me. Three years of incompetent economic mismanagement means that at the end of 2020-21, we will be exactly where we were in 2017-18," he said.
Chidambaram said there is no demand in most parts of the country, including in developed states such as Tamil Nadu, and added that it was left to one's imagination how backward states like Uttar Pradesh, Bihar, and Odisha must be coping.
"You have ignored the bulk of India. Who is this budget for?" he asked while saying that the incompetent management will undo the growth achieved and the borrowings will only be used to fill the huge craters in the economy.
"Mark my words, the growth projections will fall short by the end of 2021," the former finance minister asserted.
He said the government projected a 14.8-per cent GDP growth rate and then said it will grow by 11 per cent.
"Inflation next year will be at least five or six per cent.... The arithmetic I have says your growth will only be 9.4 or 8.4...which is a natural and mechanical growth after the coronavirus-induced slowdown. Do not boast about the numbers. It will take you two-three years to get to a stable GDP. Take the advice of well-meaning critics, address the structural issue of the economy and support the poor. Do not go boasting about these numbers," Chidambaram said.
Asking the government to withdraw the budget, he said major numbers are suspect in this year's budget.
The total additional capital expenditure is Rs 51,000 crore, he pointed out and asked, "Where did the rest of the money go?"
"On the revenue side, your expenditure has increased by over Rs four lakh crore and a revenue shortfall of over Rs three lakh crore. Mark my words, the revenue projections for next year are ambitious and there will be a shortfall," the Congress leader said. Accusing the government of not spending enough on capital expenditure, he said, "The numbers will unravel and there is no excuse this year."
Chidambaram said for the first time, there was no mention of defence in the budget speech while the allocation for health was reduced.
Terming the text and speech of the budget as "prosaic and bureaucratic", he demanded to know the pretext of the speech.
"We have a pandemic. Let me tell you that we do not hold you responsible for the coronavirus nor hold you responsible for it leaving," he said.
Chidambaram said the Congress rejects the budget and added: "We must, therefore, record our strongest protest and dissent. And because of this dissent, we will be called 'andolanjeevi' and 'parjeevi'."
He urged the government to provide relief to people and migrant labourers by providing cash transfers and ration, else he warned that the poor will wake up and in a non-violent, peaceful manner, show what should be done.
The Congress leader said the government has failed to stimulate demand for growth in the country and the GDP will go back to the figures of three years ago because of "incompetent economic mismanagement".
"Every economist in the world has said we have to stimulate demand and the best way to stimulate demand is to put money in the hands of people. This government has failed on that account. I repeat the charge. You are still not learning the lessons of the last 36 months. I am afraid that as a result of your not learning the lessons, another 12 months will be lost and the poor will suffer and suffer greatly," he said.
The former finance minister said the GDP (Gross Domestic Product) in 2004-05, in constant prices, was about Rs 32.42 lakh crore, and when the Congress-led UPA demitted office in 2013-14, it was a little more than three times at Rs 105 lakh crore.
"Since then what has happened? In 2017-18, it was Rs 131 lakh crore. In 2018-19, it crept up to Rs 139 lakh crore. In 2019-20, it was a slower crawl to Rs 145 lakh crore and in 2020-21, the year that is about to end, the first half is about Rs 60 lakh crore, and the year may end at about Rs 130 lakh crore, which means we are back to where we were in 2017-18," he said.
Inputs from PTI