The Hindu : Parliament passes Finance Bill

Online edition of India's National Newspaper
Tuesday, May 07, 2002

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National

Parliament passes Finance Bill

By Our Special Correspondent

NEW DELHI May 6. The Finance Minister, Yashwant Sinha, today disclosed that a meeting of State Finance Ministers would be convened to deal with their fiscal problems, even as Parliament approved the budget for 2002-03, with the Rajya Sabha returning the Finance Bill which was passed by the Lok Sabha last month.

Replying to the debate, Mr. Sinha assured that the Centre would not adopt an adversorial approach while tackling the fiscal problems of States, especially Tamil Nadu, Bihar and Orissa. He stressed that the Centre would not like to be a lender of last resort as its resources were limited, but at the same time it would not have "adversorial relations'' with the States.

In this context, he claimed that the Centre had not allowed politics to come in the way of improving the fiscal situation of States. He said the approach had been totally professional in a bid to improve the situation. This could be done only through cutting expenditure and improving revenue collections by levying user charges.

Responding to the Opposition criticism that the Government was yielding to pressure from multilateral agencies like the World Bank, he said India was not an indebted country which had to act according to the dictates of these organisations. At the same time, every country yielded a bit to the international organisations of which it was a member. However, he assured that the country would not submit to any unfair pressures and would continue to fight for the rights of developing countries, like it had at the World Trade Organisation's Ministerial Conference in Doha.

Mr. Sinha ruled out the prospect of any immunity scheme to tap black money as it penalised honest taxpayers and rewarded defaulters.

He conceded that employment opportunities had declined in the public sector. But he rejected the charge that the Government was pursuing jobless growth. In fact, employment opportunities had increased in the unorganised and private sectors, especially in the housing sector which was growing by 30 per cent.

Earlier, initiating the debate, Murli Deora (Congress) had lambasted the Government for its poor economic performance with employment falling and GDP growth reaching a low of 5.4 per cent. Highlighting the need for increasing employment in the country, he recalled that the BJP and its allies had promised that every year, ten million jobs would be provided in the economy.

Quoting statistics, he said employment creation had fallen from 1.5 per cent in 1996 to a negative 0.17 per cent currently. Even the Central Statistical Organisation (CSO) had reported a decline in the number of employees by nearly three per cent during 1999-2000.

He pointed to the dismal fiscal scenario with revenue expenditure shooting up and internal debt having virtually doubled over the last three years. Underlining the need to push economic reforms, he said the time had come to allow 49 per cent equity to foreign investors in all sectors.

Biplab Dasgupta (CPI-M)) said with the present low rate of savings — both domestic and on the foreign exchange reserve front — it was near impossible to achieve this ambitious growth target set by the Prime Minister.

Ramashankar Kaushik (SP) felt the Government was encouraging globalisation according to the dictates of the WTO at a time when the country's fiscal health was deteriorating.

When the country was not a signatory to the WTO, the fiscal situation was far better, with agricultural growth rate at 3.5 per cent during the eighties as against 1.5 per cent in the last decade, he added.

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