Attacking the government over the rupee hitting a record low against the US dollar, Rajya Sabha member Kapil Sibal on Saturday questioned Prime Minister Narendra Modi’s silence on the issue, alleging it stemmed from political compulsions rather than economic reality.
Speaking to PTI on the eve of the presentation of the Union Budget, the former Union minister said the purpose of any budget was to increase pleasure and reduce the pain of the poor, but expressed scepticism that this goal would be met, citing the government’s track record over the past 11 years.
Sibal claimed the prime minister had earlier criticised the UPA government over the rupee’s weakness as part of a “political game” and was now quiet because the currency had fallen further under his watch.
“First of all people should understand what a budget is. The budget is the allocation of resources based on the revenues that the government earns and the monies that the government has for certain programmes which should target the most underprivileged sections of the society. It is a utilitarian concept, you must give pleasure and you must reduce pain,” Sibal said.
He said the real test of an economy was not growth figures alone, but whether people’s pain was being reduced, with per capita income serving as one indicator.
“If the people are poor, you must uplift them, if certain states are getting less money, you must make sure that they get more money, that is what the budget is all about,” he said.
The Independent Rajya Sabha member alleged that the government lacked sufficient resources because it had failed to create surpluses over the past 11 years.
Sibal pointed out that when Modi assumed office, the rupee stood at 63 to a dollar, compared to 92 now, adding that this meant all imports had become more expensive for Indians.
"What is imported -- 84 per cent of crude oil is imported, price of that import has increased in terms of the loss of the currency from 63 to 92 ... what else do we import, we import manufactured goods -- they cost more, every medical equipment that is needed, then the telecom sector hardware, in agriculture -- fertilizers etc. All cost more.
"We are not an export-oriented economy, we are an import-dependent economy and now everything costs more. Who pays for it -- you and I..who suffers the poor because poor people need jobs and there are not enough jobs in the market," Sibal said.
He said the government does not have surpluses to reduce the pain of the people.
"You increase the pleasure of the rich people, how do you increase their pleasures --they can buy a Lamborghini now as tariff would be low, they will buy imported cars. I If prices increase, it does not matter to them," Sibal said.
So, the government increases the pleasure of the rich and do not reduce the pain of the poor people, he claimed.
"This budget hopefully will do that (reduce the pain of the poor) but I doubt it because it hasn't been reflected in the last 11 years, and I don't thin it will reflect now," Sibal said.
The real weakness of the economy is that 80 per cent of the people in India live on less than Rs 5,000-10,000 a month, he said.
"Can we be happy with that. It is a shame. What has Modi ji done about it -- nothing," he alleged.
Sibal said before Modi came to power he talked about the falling rupee and why the currency of other countries were not falling.
"So why is Modi ji silent today? Why is he quiet? He was the one who was attacking the strength of the rupee. At that point in time, it was about 58, it became 63 before he came to power. He used to give lectures after lectures to the people of India and now suddenly when the rupee is 92, he is quiet, and rightly so as he knows that it was a political game (back then)," Sibal said.
His remarks come a day after the rupee hit its record low of 92.02 before ending 6 paise higher at 91.93 against the US dollar amid a firm American currency and geopolitical uncertainties.
Asked about India the Economic Survey projecting india to grow by 6.8-7.2 per cent in the fiscal year starting April and reaffirming the country's status as the world's fastest-growing major economy, Sibal said India is the fastest-growing economy, but people don't really understand what that means.
"If I earned Rs 1,000 yesterday and Rs 2,000 today, that's 100 per cent growth - If you have a low base in the economy and suddenly in one year you increase that it will show that you are growing fast," he said.
Sibal asserted that the real test of an economy is whether it reduces people's pain.
One way is to look at the per capita income, even though that is not an absolute test, he added.
"The per capita is how much an individual earns as compared to individuals in other countries. India's per capita income is about USD 2,800 a year, lower than that of many other economies like Brazil, China and South Africa," he said.
"That means the average person here has less money in their pocket compared to people elsewhere. So even if you are the fastest growing economy, it does not solve the problems of people because people need money in their pockets," he said.
If medical care, education, consumer goods, and agricultural inputs such as fertilisers are all becoming more expensive, it means poor people simply don't have the capacity to meet their daily needs, he argued and added that is a "very serious situation".
On President Droupadi Murmu calling on parliamentarians to stand united on issues of national security and resolve for Viksit Bharat, Sibal said the most crucial issue in this country is communal harmony.
"The prime minister must come forward and ensure that communal harmony is maintained. Another key issue is making our country economically strong, but that cannot happen if you don't listen to others or accept different views," he said.
Defence is also a vital issue, and there too the opposition must be taken into confidence, he said.
"The President is absolutely right, we must come together to be together, to march along together. But this government has never allowed us to do that," Sibal added.