2004 budget to favour the poor and tax the rich
The Church is in favour of the new vision for the country's development
New Delhi (AsiaNews) The Indian government is to pay more attention to the needs of the poor than to those of the financial markets. The Union Budget for 2004 presented in Parliament yesterday seeks to favour the rural sector over the financial sector. By reserving a privileged place in the budget to agriculture, the Singh government has kept the promise it made during the electoral campaign that it would focus on the problems of the more underdeveloped sectors of Indian society. This 'Pro-Poor Budget' has allocated an extra 100 million rupees (US$ 2.1 billion) to the rural sector. In India, 700 million people (about 70% of the total population) live in the countryside. The budget also includes cheaper agricultural credit, better farm and livestock insurance, higher allocations to promote Agri-business and agricultural research, rural infrastructure improvements and better water supplies.
Primary education and better children's nutrition are some other key objectives the government has set out in the budget. Finance minister Palaniappan Chidambaram imposed a 2% one-off surcharge on taxes (amounting to 40-50 billion rupees) in order to fund education and free lunches in state-run schools. The government also wants to ensure that children remain in school for at least 8 years. Currently, about one adult Indian in two (47%) is illiterate. "If primary education and the [nutrition] scheme work hand in hand, I believe there will be a new dawn for the poor children of India," the minister said.
With the "Food-for-Work Programmes" in 150 Most Backward Districts of the country, the government hopes to reduce the number of people living below the poverty line. The government wants to increase housing and employment opportunities for the poor as well as make basic medicines more accessible. Chidambaram also promised to table a new bill that would guarantee the poor at least 100 days of employment a year.
The 2004 budget does not favour the financial sector whose reaction to the turnover tax was decidedly negative. The Communist Party of India, a partner in the coalition government, has also reacted negatively saying the budget is "a bonanza for foreign investors, big corporations and consumers." For the Communists, increased defence spending (set at US$ 16.8 billion) was a "betrayal."
Chidambaram's budget speech was frequently interrupted by Lok Sabha (Lower House) members from opposition Hindu nationalist Bharatiya Janata Party, traditionally seen as a backer and a defender of industry and urban Indians.
The budget is not however expected to reduce the deficit which is considered by many as challenge to sustained economic growth.
Speaking on television, the Finance minister reacted to the markets' thumbs down by stressing that the real India does not live in big cities but in small villages. He urged his show hosts to travel with him across the countryside and see with their own eyes how most people live.
In an interview with AsiaNews, Mons. Percival Fernandez, Secretary-General of the Catholic Bishops' Conference of India, who recently met with Prime Minister Singh, stated: "I am convinced that the present Government will stand by their Common Minimum Programme that is geared to the weaker section of our people and farmers. What is most important in these and the food-for-children programme is not the programmes themselves, but their implementation. Most of the time the money spent does not reach the beneficiaries. If methods are organized to see that the beneficiaries are the ones for whom the expenditure is met, the plans and programmes of the government can be termed successful. In India this is one of the weak links in efficient and effective governance. Let us hope and pray that the present government succeeds in its efforts to meet the needs of the masses of India, living in the villages!"
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25/07/2013
