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Q: It has been 25 years since you presented your last full budget in 1984. How do you see the changes since then?
A: A lot of changes have taken place since then. The Indian economy has become much more vibrant and resilient. Despite tremendous pressure of the international financial crisis, the Indian economy has been able to maintain a high growth rate of 6.7 per cent, despite the fact that a large number of economies, including those of North America and Europe, have fallen by the wayside. Including many Asian economies... Today, India is considered the second fastest growing economy in the world.
Today, we worry that our growth has come down from 9 per cent to 6.7 per cent. But in the 1980s, we could not think of reaching beyond 5 per cent.
This is the first time we have entered a higher growth rate regime of 8-9 per cent despite a slowdown of growth rate in 2008-09 and that is the fundamental difference. The Indian economy is strong today; we have gone through a hiccup, but shortly we will overcome the crisis.
Q: Your budget’s focus was on the aam aadmi as you had promised ...
A: Of course. But what does the aam aadmi require? They require food, employment, shelter and minimum basic requirements like education, health, and nutrition. All these things have to be provided for... they will not come as charity, it must come as earned income and for that, we shall have to give them employment opportunities.
Therefore, my emphasis has been on development of the rural infrastructure… both physical and social infrastructure. I have substantially stepped up all rural sector-related programmes, including NREGA, all six components of Bharat Nirman. If you take all this into account, the total step-up in expenditure is more than 79 per cent.
Similarly, the other disadvantaged section of our society is women. I have doubled the outlay for all five women-specific programmes. The outlay has gone up from from Rs 62,600-odd crore to Rs 124,000 crore. This is a 98 per cent increase. These are the areas where we have focused — minorities, another disadvantaged group for whom I have increased the developmental focus by 74 per cent .
Q: Farmers form the other basic group which you have addressed.
A: Yes, the basic thrust has been agriculture. For farmers I have given interest rate subsidy, where we would compensate the banks for the subvention they provide to farmers.
Farmers benefit from two things. One is availability of quality credit at an affordable rate, which we are providing. For loans up to Rs 3 lakh, we are charging 7 per cent interest, which will be reduced to 6 per cent for those farmers who do not default on payments.
Q: You have also come out with a large outlay of Rs 10 lakh crore which many see as a stimulus package by itself, besides sops to various sectors. How do you see the economy moving forward?
A: Earlier, three stimulus packages amounting to Rs 186,000 crore were given. However, this could not have a full impact due to various technical problems like the election code of conduct, which did not allow us to spend the allocated money. Now we’ll start providing full benefit of the stimulus packages. Moreover, the increased outlay will boost demand in the economy.
Q: Infrastructure development seems to be a key theme in your budget.
A: Construction of roads, improvement of railways, ports, communications for which allocations have been made in the budget. We are putting money in the system through various means like increasing outlay for national highway projects and rural housing schemes.
For instance, the allocation for railways has been increased from Rs 10,800 crore made in the interim budget to Rs 15,800 crore in the final budget. Besides, I have allowed the railways to float Rs 5,000-crore tax-free bonds to service their infrastructure building.
The national highway project spending has been stepped up by 23 per cent. These will go a long way in developing infrastructure.
Q: You have budgeted Rs 35,000 crore from spectrum auction and around Rs 1,100 crore from divestment.
A: I have only given broad indications in the budget that PSUs will have to retain 51 per cent government shareholding. However, the general public should also have some stake. These are general directions; the details need to be worked out later by specific agencies.
Q: Do you expect any political opposition to divestment plans?
A: We can only wait and watch how the Opposition reacts to the disinvestment plans. |
