Budget will be soft on rich, harsh on poor: Bardhan

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New Delhi, Nov 12: CPI General Secretary A B Bardhan expects a raw deal for the poor and common man in the coming Budget, but it to be soft on the rich, including a reduction in income tax.

Coming harshly on the government for pursuing policies, which are pro-rich and favourable to big business, Mr Bardhan has accused the government of paying only lip service to the commitments made in the National Common Minimum Programme (NCMP). Some of the programmes listed under the NCMP have not even been started, he said.

The Communist veteran made these remarks in an interactive session with the Forum of Financial Writers on the expectations of the Left parties from Budget 2007-08. This was the first in the Budget series that the Forum was planned.

Mr Bardhan suggested a number of measures for larger resource generation, including a review of tax incentives, imposition of some form of Tobin tax, such as, tax as on purchase of foreign currency, and higher level of wealth tax and Securities Transaction Tax (STT).

What has been promised has not been delivered. Late in life Finance Minister P Chidambaram has realised that honesty is the best policy. According to Mr Chidambaram lowering of tax rates, leads to better compliance and higher revenues. This is a myth, Mr Bardhan said.

He said the Left parties would bring amendments to the Special Economic Zone (SEZ) Bill in the Budget session. These include the nature of land to be acquired and the compensation for it.

Industry which preaches free market, does not want to pay market price for land for SEZs, he said.

Mr Bardhan took on the government for poor record on implementation of programmes, including the National Rural Employment Programme (NREP). The Left parties had pushed for the NREP, but the performance of the scheme has been dismal, he said.

He said the Left parties wanted higher spending on the social sectors, including meeting the target of 6 per cent of GDP on education and 3 per cent on health.

But, Mr Bardhan said there was much talk and little action on hiking spending on education and health, and cited figures to show that the increase on these two sectors had gone up only minimally in the past few years. No amount of money spent on education can suffice, he remarked.

He said Indian agriculture was in a state of crisis, resulting in farmers committing suicides in various parts of the country. There was huge indebtedness among farmers, he said, and demanded implementation of the Report of the Farmers Commission, headed by eminent agricultural scientist M S Swaminathan.

The Left leader asked the government to explain as to why while GDP growth was in the region of eight per cent per annum, India ranked a poor 126 out of 171 countries on Human Development Index (HDI).

This only goes to show that the lot of the poor and common man had not improved, he said.

Mr Bardhan also took on the financial press for making too much of the SENSEX, but failing to highlight the condition of the masses.

What has the Bull Run on the bourses to do with the condition of the common man?. I don't know when the back of the Bull will be broken? he asked.

Mr Bardhan said the BSE SENSEX crossing the 13,000 mark was only reflective of the run away profits of the Corporate Sector or what are known as super normal profits. There is also a high level of speculation on the stock exchanges, he said.

He said the Left parties would oppose in Parliament the Banking Regulation and Development Bill as it would strengthen the hold of foreign banks. They would do the same for the Pension Fund Regulatory and Development Authority Bill.

Mr Bardhan said the Sachar Committee's has report pointed out that the condition of the minorities still worse and needed sincere efforts to improve their condition. By and large the Muslim community has benefited the least from the development process and said the Budget should outline measure to correct this historical imbalance.


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