Bharatiya Janata Party's key economic strategist
Jagdish Shettigar had a lot to say about this year's Budget. In an hour long chat with
rediff.com readers, he answered their queries with clear, incisive logic.
Here is the transcript:
Jagdish Shettigar says, The finance minister has two positive factors in his favour. Namely bulging revenue collections and high economic growth over 9 per cent but at the sametime he had challenges to contain inflation and also to maintain the image of the ruling combine as pro-commonman. But unfortunately he has failed to utilize the positive factors in his favour in addressing the challenges before him effectively.
ak asked, Sir, Do you think that this budget is common man friendly inspite that education surcharge increase to 3% (increase in service tax and corporate tax)
Jagdish Shettigar answers, at 2007-03-01 16:34:15Mere increase in surcharge from 2-3% need not be seen as anti-commonman since the objective behind the proposed increase in cess is laudable. But he has to ensure that the revenue collected through addition cess should be properly and efficiently utilized for the purpose it is meant for. But when you look at the budget as a whole I do not think that it can be described as the one meant for caring Aam Aadmi.
SR SATISH asked, No Government, whether it is NDA or UPA, has dared to enhance the IT limit inspite of inflation. May I know the reason Sir?
Jagdish Shettigar answers, Any government would like to give as much concession as possible and minimise the tax burden. In fact the BJP had promised to raise the exemption limit to Rs one lakh at five years prior to coming to power. But it could not fulfill the promise mainly due to the prevailing fiscal situation of pressure to meet the need for enhanced expenditure for developmental purposes and also the limited revenue collection base.
bakul asked, Sir, what is ur rating on a score of 10 to this budget ?
Jagdish Shettigar answers, Frankly I would not like to get into this exercise of grading the budget especially in view of the fact I belong to the opposition party and hence I may not be able to make a fair assessment.
Alok asked, Sir! Do you think we can sustain 9+ growth for next year
Jagdish Shettigar answers, Yes, we can. In fact there is a potentiality of India reaching double digit growth rate but this needs further movement on reform track. Unfortunately the present government is not in a position to carry forward the required reform process mainly due to the presence of left front.
sam asked, Sir, Previous ur NDA governament was so sympathetic towards salaried class who real contributers for exchaquers, y this govt is against salaried class?
Jagdish Shettigar answers, The present government has removed special treatment given to the salaried class visa viz non salaried class- by removing standard deduction benefit. Besides they also imposed fringe benefit tax which now got extended to IT sector.
sam asked, Sir, I feel one importants issue FM has missed out that is GLOBAL WARMING. i expected this could be taken up on priority as in couple of years there will disatsarous effect on agriculture and general living ...
Jagdish Shettigar answers, No, he has initiated a move in this direction by announcing to set up a committee to study impact of climate changes. In future corrective steps may be taken in the light of recommendation by the experts committee.
sd asked, Is this a farmer friendly Budget? If so, why?
Jagdish Shettigar answers, It has only shown lip sympathy towards the farm sector without taking concerete steps to address the crisis the farmers have been facing during the last couple of years. The minimum he could have done is to bring down interest rate on farm loans keeping in view suicides by the farmers in different parts of the country. With regard to fertilizer subsidy he showed good intention by announcing the subsidy should be distributed to the farmers directly as against the present system of distributing the same through fertilizer companies. In fact this has been resulting in lot of leakage- more than 50 per cent going to the kitty of fertilizer companies and hence reform in this respect is long pending. But he has just announced to set up a committee the modus