The Telegraph
Since 1st March, 1999
Email This Page
Cold water on Left's hopes
- Banking reforms raise hackles, ally to meet PM

New Delhi/Calcutta, Feb. 28: For the Left, morning didn't show the day.

Happy at first with P. Chidambaram's budget, the enthusiasm of the Left parties ebbed once they sat down with their calculators. By evening, they were caught by surprise when the RBI announced banking reforms.

'We oppose this trend of making decisions outside Parliament,' said CPI leader D. Raja. Tomorrow, the United Progressive Alliance and the Left will meet at the Prime Minister's residence.

The commitments have fallen short of the Left's expectations. 'The budget presents a welcome shift towards emphasising employment generation, infrastructure development, particularly in the rural areas, and investment in the social sector,' the CPM politburo said. 'But the actual expenditures visualised for the social sector fall far short of our expectations.'

The Left parties had given a 12-point charter of demands to the finance minister, including the demand for a Rs 50,000-crore allocation for the social sector. But far less has been given, CPM MP Nilotpal Basu said.

Bengal's ruling CPM appeared divided. While central committee member Benoy Konar said the Congress has not changed its bourgeois character, finance minister Asim Dasgupta called it a 'pro-people budget' and welcomed the thrust on rural infrastructure, health and family welfare as 'steps in the right direction'.

'They (the corporate sector) are saying the budget is very good. We believe the budget will protect the interest of the corporate sector, which is why they are happy,' Konar, a hardliner, said.

A potential area of discord is the proposal to introduce foreign direct investment in mining, trade and pension funds. 'There can be no objections to FDI in areas where it adds to the country's economic activity and productive base. Mining and pension, however, do not fall in this category,' the CPM said.

About FDI in trade, Dasgupta said 'if multiplexes were to invade our neighbourhood, small shops in the locality would be wiped out'.

Konar said though the Union government made 'tall promises' of providing employment to at least one person from each family below the poverty line, the Rs 11,000-crore allocation for this purpose is 'nothing but an eyewash'.

One of the Left's main complaints is that tax revenue estimates in the budget appear to be 'significantly over estimates'. 'This means the social sector may suffer in case the government has to slash expenditures in case of a tax shortfall,' the CPM said.

'This is not what we wanted. It would be a delusion to think Chidambaram has given in to our wishes,' said CPI MP Gurudas Das Gupta.

The Left is not pleased with the tax structure, the imposition of a 50-paise cess on petrol and diesel and the autonomy of public-sector banks. 'The reduction in overall corporate income-tax rates on domestic companies is uncalled for,' the CPM said.

Email This Page