Cosmetic budget directed at foreign investors: Jayalalithaa

Last Updated: Thu, Feb 28, 2013 12:40 hrs

Tamil Nadu Chief Minister J.Jayalalithaa Thursday charged the United Progressive Alliance (UPA) government with acting "more for the foreign investor than for any domestic constituency" as she described the budget for 2013-14 "a daydream cosmetic budget".

In a statement issued here, Jayalalithaa, referring to Finance Minister P.Chidambaram's emphasis on the importance of foreign direct investment (FDI), said: "It is interesting to note that the only way that the finance minister can think of to bridge the Current Account Deficit is to encourage foreign investment, without examining what you can do to promote exports from India."

"The measures announced for promotion of exports are very minimal, while many sops have been announced for foreign investment. This clearly reveals that the UPA government at the centre acts more for the foreign investor than for any domestic constituency."

Terming the budget as "uninspiring damp squib, full of rhetoric", Jayalalithaa said: "It pays lip service to the cause of the common people, but does little to correct deeper structural issues in the economy. I would describe it only as a day dream cosmetic budget of Mr. P. Chidambaram, the union finance minister."

She said that the slowdown in economic growth and the sharp rise in inflation in the last two years which have caused so much pain to the people of the country "were primarily due to the inept macro-economic management by the UPA government, which is now sought to be attributed to a variety of other factors".

Claiming lip service is being paid to inclusive and sustainable development, Jayalalithaa remarked that "major damage has been inflicted by very deep and harsh cuts in spending in crucial social sectors in the revised estimates (RE) for 2012-13".

She said plan expenditure has been cut from Rs.5,21,025 crore in budget estimates (BE) 2012-13 to Rs.4,29,187 crore in RE 2012-13.

"These deep cuts raise a number of unanswered issues. What is to be done where state governments have already spent substantial sums based on approvals of their Annual Work Plans? They will not receive the due reimbursements in the current fiscal year," she said, adding the central government aims to reach its fiscal deficit target in the current year at the expense of the state governments.

Demanding rolling back of cuts in the the revised estimates for 2012-13, Jayalalithaa said the deep cuts imply that budget estimates presented to parliament lack sanctity.

"..where is the guarantee that the increases that are proposed in many crucial social outlays will be provided for in 2013-14? This Budget presents a watershed - a watershed which completely destroys the credibility of the budgetary process of the Government of India," she said.

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