PREVIOUS HOUR

VP/SC/12.00/1N

PAPERS LAID ON THE TABLE

1.  SHRI MD. ALI ASHRAF FATMI: Sir, I lay on the Table  a copy each (in English and Hindi) of the  following papers:

(i) Outcome Budget of the Department of Elementary Education and Literacy in the Ministry of Human Resource Development for the year 2006

(ii) Performance Budget of the Department of Elementary Education and Literacy in the Ministry of Human Resource Development for the year 2005

(iii) Outcome Budget of the Department of Secondary and Higher Education in the Ministry of Human Resource Development for the year 2006

(iv) Performance Budget of the Department of Secondary and Higher Education in the Ministry of Human Resource Development for the year 2005

2. SHRI SUSHILKUMAR SHINDE : Sir, I lay on the Table a copy each      (in English and Hindi) of the following papers:

    (i)

(a) Outcome Budget of the Ministry of Power for the year 2006.

 

(b) Performance Budget of the Ministry of Power for the year 2005.

    (ii)

(a) Annual Report and Accounts of the National Power Training Institute (NPTI), Faridabad, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b) Review by Government on the working of the above Institute.

 

(c) Statement giving reasons for the delay in laying the papers mentioned at (a) above.

3.   SHRI PRIYARANJAN DASMUNSI: Sir, I lay on the Table:

I (1). A copy each (in English and Hindi) of the following papers, under sub-section (1) of section 619A of the Companies Act, 1956:

 

(a) Annual Report and Accounts of the National Film Development Corporation (NFDC), Mumbai,  for the year 2004-2005, together with   the Auditor's Report on the Accounts and the comments of the Comptroller and Auditor General of India thereon.   

 

(b) Review by Government on the working of the above Corporation.

(2). Statement (in English and Hindi) giving reasons for the delay in laying the papers mentioned at (1) above.

II.  A copy each   (in English and Hindi) of the following papers:

(i)

(a)

Annual Report and Accounts of the Childrens Film Society, India (CFSI), Mumbai, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(ii)

(a)

Annual Report and Accounts of the Satyajit Ray Film and Television Institute (SRFTI), Kolkata, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Review by Government on the working of the above Institute.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(MR. DEPUTY CHAIRMAN IN THE CHAIR)

4.  SHRI PRITHVIRAJ CHAVAN: Sir, I lay on the Table a copy  (in English and Hindi) of  the Performance Budget of  the Department of Atomic Energy for the year 2006-07.

5.  SHRI MD. ALI ASHRAF FATMI: Sir, I lay on the Table :

I. A copy (in English and Hindi) of the Ministry of Human Resource Development Notification No. IG/Admn (G)/St.9/2004/192 dated the 20th August, 2005, amending Statute 9A made under the Indira Gandhi National Open University (IGNOU) Act, 1985, under sub-section (2) of section 40 of the Indira Gandhi National Open University Act, 1985, together with delay statement.

II.  A copy each (in English and Hindi) of the following papers, under sub-section (1) of section 619A of the Companies Act, 1956:

 

(a) Annual Report and Accounts of the  Educational Consultants India Limited (Ed. CIL), New Delhi,  for the year 2004-2005, together with   the Auditor's Report on the Accounts and the comments of the Comptroller and Auditor General of India thereon.

 

(b) Review by Government on the working of the above Company.

III (1).  A copy each (in English and Hindi) of the following papers, under section 18 of the University Grants Commission Act, 1956:

 

(a) Annual Report of the University Grants Commission (UGC), New Delhi, for the year 2004-2005.

 

(b) Review by Government on the working of the above Commission.

(2). Statement (in English and Hindi) giving reasons for the delay in laying the papers mentioned at (1) above.

IV (1).  A copy each (in English and Hindi) of the following papers, under sub-section (3) of section 30 of the Tezpur University Act, 1993.:

 

(a) Annual   Report of the Tezpur University, Assam,  for the year    2004-2005.

 

(b) Review by Government on the working of the above University.

  (2) Statement (in English and Hindi) giving reasons for the delay in laying the papers mentioned at (1) above.      

V.   A copy each   (in English and Hindi) of the following papers:

(i)

(a)

Annual Accounts of the Visva-Bharati, Santiniketan,   for the year 2003-2004, and the Audit Report thereon, under sub-section (4) of section 36 of the Visva Bharati (Amendment) Act, 1984.

 

(b)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(ii)

(a)

Thirtieth Annual Report of the University of Hyderabad, Hyderabad, for the year 2004-2005.

 

(b)

Annual Accounts of the University of Hyderabad, Hyderabad, for the year 2004-2005, and the Audit Report thereon,           under sub-section (4) of section 29 of the University of Hyderbad Act, 1974.   

 

(c)

Review by Government on the working of the above University.

 

(d)

Statements giving reasons for the delay in laying the papers mentioned at (a) and (b) above.

(iii)

(a)

Annual Report and Accounts of the Board of Practical Training (BOPT), Eastern Region, Kolkata, for the year 2004-2005, together with the Auditor's Report on the Accounts.    

 

(b)

Review by Government on the working of the above Board.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(iv)

(a)

Annual Report and Accounts of the National Council of Rural Institutes (NCRI), Hyderabad, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Review by Government on the working of the above Council.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(v)

(a)

Annual Report and Accounts of the Indian Institute of Management (IIM), Calcutta, for the year 2003-2004, together with the Auditor's Report on the Accounts.   

 

(b)

Review by Government on the working of the above Institute.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(vi)

(a)

Annual Report and Accounts of the National Institute of Foundry and Forge Technology (NIFFT), Ranchi, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Review by Government on the working of the above Institute.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

6.   SHRIMATI D. PURANDESWARI: Sir, I lay on the Table a copy each   (in English and Hindi) of the following papers:

(i)

(a)

Annual Report and Accounts of the Sarva Shiksha Abhiyan (SSA), Uttaranchal Sabhi Ke Liye Shiksha Parishad, Dehradun, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(ii)

(a)

Annual Report and Accounts of the Axom Sarba Shiksha Abhijan Mission, Guwahati,  for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(iii)

(a)

Annual Report and Accounts of the Sarva Shiksha Abhiyan (SSA), U.P., Education for All Project Board, Lucknow,  for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(iv)

(a)

Annual Report and Accounts of the Sarva Shiksha Abhiyan (SSA), State Mission Authority, Nagaland,  for the year         2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(v)

(a)

Annual Report and Accounts of the District Primary Education Programme-III (DPEP-III), U.P. Education  for All Project Board, Lucknow,  for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(vi)

(a)

Annual Report and Accounts of the District Primary Education Programme-III (DPEP-III), Uttaranchal Sabhi Ke Liye Shiksha Parishad, Dehradun,  for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(vii)

(a)

Annual Report and Accounts of the Sarva Shiksha Abhiyan (SSA), Union Territory Mission Authority, Dadra and Nagar Haveli,  for the year 2003-2004, together with the Auditor's Report on the Accounts.   

 

(b)

Review by Government on the working of the above Authority.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(viii)

(a)

Annual Report and Accounts of the Sarva Shiksha Abhiyan (SSA), Union Territory Mission Authority, Dadra and Nagar Haveli,  for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Review by Government on the working of the above Authority.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(ix)

(a)

Annual Report and Accounts of the Himachal Pradesh       Primary Education Society, Shimla (SSA Programme), for the year 2003-2004, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(x) 

(a)

Annual Report of the National Bal Bhavan,  New Delhi, for the year 2004-2005.   

 

(b)

Annual Accounts of the National Bal Bhavan, New Delhi, for the year 2004-2005, and the Audit Report thereon.   

 

(c)

Statement by Government accepting the above Report.

 

(d)

Statement giving reasons for the delay in laying the papers mentioned at (a) and (b) above.

(xi)

(a)

Annual Report and Accounts of the Assam Mahila Samata Society, Guwahati,  for the years 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

(xii)

(a)

Annual Report and Accounts of the Mahila Samakhya  Karnataka, Bangalore, for the year 2004-2005, together with the Auditor's Report on the Accounts.   

 

(b)

Statement by Government accepting the above Report.

 

(c)

Statement giving reasons for the delay in laying the papers mentioned at (a) above.

 

(Ends)


REPORT OF THE COMMITTEE ON SUBORDINATE LEGISLATION

 

SHRI RAVULA CHANDRA SEKAR REDDY (andhra pradesh) : Sir, I present the Hundred and Sixty-second Report (in English and Hindi) of the Committee on Subordinate Legislation on the Statutory Orders laid on the Table of the Rajya Sabha during the     206th  Session.

(Ends)

REPORT OF THE DEPARTMENT RELATED PARLIAMENTARY STANDING COMMITTEE ON INDUSTRY

 

ߴ֟ ״֡ ֮֕ (׸) : , "ָ ֮֬ ו֟ ׻֋ ..... ׬ֿ ׸ӯעֵ ㌟ ֣ ..... և ãן" ӲӬ ׾ֳ Ӳ׬֟ ӲӬ ֤ߵ ãֵ ״ן ָ ן־ ( ֣ ) ß (Ends)

MATTERS RAISED WITH PERMISSION OF CHAIR

RE: DISPUTE OVER MULLAPERIYAR DAM

SHRI P.G. NARAYANAN (TAMIL NADU): Mr. Deputy Chairman, Sir, I am shocked to learn about the decision taken at the All-party meeting held in Kochi to convene a special session of the Kerala Assembly in order to consider and pass an amendment to the Kerala Dam Safety Act. Sir, the proposed amendment, in effect, is a deliberate move to overturn the recent judgement of the Supreme Court. The Supreme Court, after hearing the Tamil Nadu Government and the Kerala Government, directed the Kerala Government to allow raising the height of the Mullaperiyar Dam to 142 feet. Sir, the neutral experts from the Central Water Commission already certified that the Dam will be perfectly safe even if the height of the dam is increased to 142 feet. But the Kerala Government refused to accept the verdict of the neutral experts of the Central Government. Sir, the very same issue has been heard by the Supreme Court for the last two years; the Kerala Government presented its case, so also, the Tamil Nadu Government. The Supreme Court, the highest judicial body of the country adjudicated the case by rejecting the Kerala Government's contention over the possible threat, and allowed the height of the dam to be raised to 142 feet. Sir, now, the Kerala Government, with the active cooperation of the Congress and the Left Parties, is all set to overturn the judgement of the Supreme Court. For this purpose alone the Kerala Assembly is being convened tomorrow.

Sir, this kind of act will, definitely, pose a serious threat to the unity and integrity of the country. Sir, if we do not accept and respect the judgement of the Supreme Court, there can be no rule of law in this country. The Kerala Government, through this move, is seeking to bring a confrontation between the Legislature and the Judiciary. Sir, I want to say that at one point of time, the Karnataka Government declared null and void an interim award of the Cauvery Tribunal by promulgating an Ordinance, but the Supreme Court heard the case and described that the move of the Karnataka Government will, definitely, pose a threat to the unity and integrity of the country. (continued by PK/1O)

PK/1O/12.05

SHRI P.G. NARAYANAN (CONTD.): So, the Supreme Court struck down that law as ultra vires...(Interruptions)...

DR. K. MALAISAMY: Sir...(Interruptions)..

MR. DEPUTY CHAIRMAN: No, no. He is from your party. He is putting forth his views. I cannot allow everybody...(Interruptions)..

SHRI P.G. NARAYANAN: Sir, Kerala is attempting to commit the same blunder. Sir, Rajya Sabha is the Council of States. I would urge this House to appeal to the Kerala Government to desist from taking such a sinister move. Sir, I request the Prime Minister to intervene in this matter, and, ensure that Kerala does not go ahead with this move. This is a dangerous move...(Interruptions)...

SHRI N.R. GOVINDARAJAR: Sir...(Interruptions)..

SHRIMATI S.G. INDIRA: Sir...(Interruptions)...

SHRI T.T.V. DHINAKARAN: Sir...(Interruptions)..

MR. DEPUTY CHAIRMAN: Okay, okay, all of you are associating yourselves with this....(Interruptions)..

SHRI RAVULA CHANDRA SEKAR REDDY: Sir...(Interruptions)..

MR. DEPUTY CHAIRMAN: Are you also associating?..(Interruptions)..

SHRI RAVULA CHANDRA SEKAR REDDY: Sir, this is a Supreme Court order. They must respect the Supreme Court order...(Interruptions)..

SHRI P.G. NARAYANAN: Sir, the Member is from Kerala...(Interruptions).. How can he reply?

DR. K. MALAISAMY: Sir...(Interruptions)..

MR. DEPUTY CHAIRMAN: Dr. Malaisamy, Mr. Anthony is speaking...(Interruptions).. You should hear other's point of view also..(Interruptions)..

DR. K. MALAISAMY: One minute, Sir. Sir, the very same issue was raised in this House by Mr. Narayanan, and the hon. Minister from the other side agreed to say that we will implement the order of the Supreme Court. That is the commitment which has been given...(Interruptions)...

MR. DEPUTY CHAIRMAN: Okay..(Interruptions)..Mr. Narayanasamy, why are you not...(Interruptions)..

SHRI V. NARAYANASAMY: Sir, I am not supporting both of them...(Interruptions)..

AN HON. MEMBER: He is neutral...(Interruptions)..

SHRIMATI S.G. INDIRA: They are from Tamil Nadu, but they are not supporting this...(Interruptions)...

SHRI R. SHUNMUGASUNDARAM: Sir, they want my view. If you permit me...(Interruptions)..

MR. DEPUTY CHAIRMAN: I have called Mr. Antony.

SHRI A.K. ANTONY (KERALA): Sir, the Kerala Assembly is meeting tomorrow and day after tomorrow, as per the unanimous decision of an all-party meeting held by the Chief Minister of Kerala. In that meeting, all political parties from Kerala unanimously decided to convene the sessuib tomorrow and day after tomorrow. Our people are concerned about the safety of some of our old dams. If anything happens, lives of lakhs of people would be in danger..(Interruptions)..

DR. K. MALAISAMY: Sir..(Interruptions)..

SHRIMATI S.G. INDIRA: Sir, ...(Interruptions)..

MR. DEPUTY CHAIRMAN: No, no. He has listened to your point of view...(Interruptions)...Please listen to him...(Interruptions)..

SHRI A.K. ANTONY : So, Kerala Assembly is meeting to consider that and pass a legislation to protect the dam. Dam safety is the main concern of the Assembly..(Interruptions).. Sir, it is a matter within the legitimate purview of the State Legislature. I think, we should not bring this matter before this hon. House, because this is a matter concerning the State of Kerala. The State Assembly is the proper forum for this..(Interruptions)..

MR. DEPUTY CHAIRMAN: Yes, Mr. Nilotpal Basu.

SHRI NILOTPAL BASU: Sir, I am very sorry to, really, contradict my very good friend, Mr. Narayanan. I value my friendship with him. But, Sir, this is the Council of States. We are discussing inter-State disputes. We are discussing the Supreme Court's judgements. We are even pre-empting the proceedings of another sovereign legislature of the country. Sir, are we entitled to do this? I think, unnecessarily, he is politicising this issue..(Interruptions)..

MR. DEPUTY CHAIRMAN: Okay, okay, next...(Interruptions)..

SHRI NILOTPAL BASU: Sir, unfortunately, these are the issues...(Interruptions)..

MR. DEPUTY CHAIRMAN:That is all right..(Interruptions)..No, no. Next...(Interruptions)..

SHRI NILOTPAL BASU: These are issues...(Interruptions)..

MR. DEPUTY CHAIRMAN: Okay, that is over...(Interruptions). Now, next subject, Shri Tarlochan Singh..(Interruptions)..That subject is over...(Interruptions)..Next issue...(Interruptions).. Mr. Nilotpal Basu, that matter is over...(Interruptions)..

SHRI NILOTPAL BASU: Sir...(Interruptions)...

MR. DEPUTY CHAIRMAN: Mr. Nilotpal Basu, Nothing is going on record...(Interruptions)... That matter is over...(Interruptions)..

DR. K. MALAISAMY: Sir...(Interruptions)..

SHRIMATI S.G. INDIRA: Sir...(Interruptions)..

MR. DEPUTY CHAIRMAN: No, no, what is this happening? Please address the Chair...(Interruptions).. This matter is not between you....(Interruptions).. Please, Mr. Basu, that subject is over...(Interruptions).. Shri Tarlochan Singh..(Interruptions)..

SHRI NILOTPAL BASU: I want to put on record my disappointment with Mr. Narayanan for having raised this issue..(Interruptions)...

(followed by 1P/PB)

PB-NB/1P/12.10

MR. DEPUTY CHAIRMAN: That matter is over. I have called for the next subject. It is a Zero Hour mention. It is not a full-fledged discussion. It is just a mention. ...(Interruptions)... ֯ ׻֋, ֯ ׻֋ ... (־֮֬) ... No; no; nobody will speak. I have gone to the next subject. ...(Interruptions)... ָ֮ , ֯ ׻֋ ...(־֮֬) ... No; no; it is not ... (Interruptions)...

DR. K. MALAISAMY: Sir, I come from an area which ... ...(Interruptions)...

MR. DEPUTY CHAIRMAN: Mr. Malaisamy, you wanted to speak for one minute. You just wanted that. ...(Interruptions)... I gave you an opportunity. ...(Interruptions)... I gave an opportunity. ...(Interruptions)... My request is, please don't convert a Zero Hour mention into a discussion. ...(Interruptions)...

DR. K. MALAISAMY: Sir, I hail from a district ....(Interruptions)... (ENDS)

MR. DEPUTY CHAIRMAN: Mr. Malaisamy, the notice was given by Mr. Narayanan, and it was a clear understanding, I would like to remind, it was a clear understanding in the Chamber that you will speak only for two-three minutes, and make a mention. The Chairman permitted it only on that understanding. ...(Interruptions)... It will not be allowed. ...(Interruptions)...We cant' take it up. ...(Interruptions)... We have to respect the understanding. ...(Interruptions)... We have to respect the understanding, which was there. ...(Interruptions)... ֯ ׻֋ ...(־֮֬) ... ָ֮ , ֯ ׻֋

RE. BROADCASTING A PROGRAMME ON "DIVISION OF INDIA"

BY A PRIVATE T.V. CHANNEL.

ָ֮ (׸) : ֮֮ߵ כ ָ , ֯ ֮־֤ ֮֯ important issue ֯ ִ֮ ֈ ִ֮ ֮ ֕֟ , 3-4 פ , ֛ .. ֻ ִ פֵ , ו heading - әָ, ִ ײ֟ ׿ֿ , ֻ Ӥ ָ әָ ֻ әָ ӕֲ , ׻ß֮ ִ ֻ ֻ

כ ָ , ׸ ָ כ , ֻ ß֮ , ׻ ֓ ׸ ֯ ָ , ӕֲ damage ֵ ֕ ֯ ִ֬ ֟ ֯ ִ֮ ֮ - ֟ ׸ , ו ֯ ִ פ֋ ֋ ׻ß֮ ֮֮ ֻ , ӕֲ ָ֬ proper representative , ӳ߸ ֟ ׸ ֮֮ ߮ ָ ׸ ׸ ָ ֌ ׮־֙ ִ ״ֻ , ו ׮־֙ և-ָֻ ׯ֟ ִ פֵ ֵ ׻ß֮ ֻ ֮֮ ֻ ָ CID, Ù CID CID , ֟ ֻ ׻ß֮ ָ ֮ damaging report ָ ֻ ָ, ֯ ִ֬ ׾֮֟ ӌֵָ -״׮Ù י , ׾֤ ָ ׻י י , , ֌ ׻ß֮ ִ , ֟ ֮ ָ , ־֕ ׻֋ ׮־ , ָ ֛-֛ ָ֡ ֈ ָ ... (־֮֬)

ֳ֯ן : ֕ Information and Broadcasting Ministry discuss , ֯ ִ ו֋ ... (־֮֬)

ָ֮ : ָ, ׾֮֟ anti-India , כ ... (־֮֬)

ֳ֯ן : ֟ ... (־֮֬) ֕ discuss , ֯ ִ ֟ ... (־֮֬) No; no, what I am suggesting is, today, we are discussing the working of the Ministry of Information and Broadcasting and, as, in some way, this matter relates to that, you can raise it there. ...(Interruptions)...

ָ֮ : ֳ֯ן , ׾֮֟ ӕֲ ָָ Ù , ִ օ ӕֲ ִܵӡ ֮־֤ prompt action ׻ֵ , ָ CID ָ ָָ alert , ֟ ... (־֮֬) ֮־֤ (ִ֯)

ֻ ָָ (ֻ֓ Ϥ) : ֮ ֣ ִ֨

ָ֕ (ֻ֓ Ϥ) : ֮ ֣ ִ֨

׸ ֕־ (ӕֲ) : ֮ ֣ ִ֨

MR. DEPUTY CHAIRMAN: What I am suggesting is, today, incidentally, we are discussing the working of the Ministry of Information and Broadcasting. These are the issues which are relating to that Ministry, and if you raise it there, then, you will definitely get a reply from the Minister. But, now, you will not be able to get any reply. You can take up the matter, at that time, then you will get the reply. ...(Interruptions)... (Followed by 1q/SKC)

1Q/12.15/SKC

DR. CHANDAN MITRA: Sir, there was a demand for a Home Ministry inquiry. That should be ...(interruption)...

MR. DEPUTY CHAIRMAN: Firstly, the question is, how the channel has shown such a report. His demand is that that there should be some control put on the channels.

DR. CHANDAN MITRA: Sir, Home Ministry...(interruptions)...

ֳ֯ן : , ֯ ֟֋ ... (־֮֬) ... ֯ ֋ ו֋ ... (־֮֬) ... Ù, ߴ֟ .. ... (־֮֬) ...

ֻ ָָ : ֳ֯ן , י פ ... (־֮֬) ...

MR. DEPUTY CHAIRMAN: Regarding what...(interruptions)...

ֻ ָָ : ָ, ֕ ֮ ָ ... (־֮֬) ...

DR. P.G. NARAYANAN: Sir, the Government is not responding...(interruptions)...

MR. DEPUTY CHAIRMAN: Mr. Narayanan, you know that Zero Hour is meant just to make a mention...(interruptions)...I cannot force the Government to respond on each and everything...(interruptions)...Shrimati Durga...(interruptions)...

DR. K. MALAISAMY: Sir, we are walking out...(interruptions)...

MR. DEPUTY CHAIRMAN: It is under the consideration...(interruptions)... ֯ ֮֟ it is under the consideration of the hon. Chairman. ֯ it will be allowed next. ֤ ֛֮ ׸ ֮ ֤ ꅠ ױ ֯ և ֟ ... (־֮֬) ...

SHRIMATI N.P. DURGA (ANDHRA PRADESH): Thank you, Sir. I would like to draw the attention of the House...(interruptions)...

DR. K. MALAISAMY: Sir, we would like to convey to this House that it is a matter of life and death for Tamil Nadu and we want an assurance in the House that the safety and security of the people of Tamil Nadu would be ensured. The entire issue has been looked into by the Supreme Court. They are playing politics. We want to protest this and we wish to stage a walk-out.

(At this stage, some hon. Members left the Chamber.)

RE. RELEASE OF HIJACKED INDIAN VESSEL, 'BHAKTISAGAR'

SHRIMATI N.P. DURGA: Sir, I would like to draw the attention of the House to save the hijacked vessel, Bhaktisagar, and its crew...(interruption)..,

Sir, according to the Indian Coastguard and the Marine Rescue and Coordination Cell, an Indian merchant vessel, Bhaktisagar, was hijacked off the Somalian coast. It is understood that 25 Indian crew members are on board the vessel. The vessel was hijacked near Imam Port while it was coming from the Kimayo Port, 35 km from Mogadishu, the capital of Somalia. It is reported that family members of the crew are worried since they don't know even the whereabouts of their beloved ones. Hence, I request the Government of India, through you, Sir, to immediately take measures through diplomatic and political channels and see to it that the crew is released and the vessel is freed from the hands of hijackers. Thank you, Sir.

(Ends)

MR. DEPUTY CHAIRMAN: Now, discussion on the General Budget, 2006. Shri Sitaram Yechury.

THE BUDGET (GENERAL) 2006-07 - Contd.

 

SHRI SITARAM YECHURY (WEST BENGAL): Thank you, Mr. Deputy Chairman Sir. Much of the discussion on the Budget has been conducted. So, I would confine myself only to certain important points, which I would like to bring to the notice of the House.

Sir, I have two general points to make before I come to the concrete proposals and the various areas that I would like to discuss. Firstly, Sir, normally, when a Budget is presented, we have the opportunity to discuss the direction of the economic policy in the country, the health of the economy. Also, normally, Budgets used to be associated with what type of additional resource mobilisation would be required to meet the targets and meet the priorities, which, for this Government, have been defined in the National Common Minimum Programme.

Sir, what I would like to begin with in the general points is that unfortunately, in this Budget, given the overall health of the economy and the positive nature of the statistics and indices that are available to us, the potential for implementing much of the programmes for the welfare of the country and the people, have not been fully utilised. I think this is a shortcoming, which is unfortunate because we could have really gone about sincerely implementing much of this. I say this because the additional resource mobilisation envisaged in the Budget, the gross tax mobilisation envisaged in the Budget, is only a meagre Rs. 6000 crores.

Having said this, Sir, the second point, which I think is important to note, is that though the additional resource mobilisation is only Rs. 6000 crores, it is expected that the gross tax revenues for the Government would grow by a whopping, Rs. 72,000 odd crores, in other words, a 19.5 per cent increase -- I have just stopped because I thought I have offended the Finance Minister...(interruption)...

Now, this whopping increase in gross tax revenues in itself is not a flash in the pan, which suddenly happened this year. If you look at it from 2002 and 2003, the gross tax revenues increased by 15.6 per cent, in the next year, by 17.6 per cent, the year after that, by 19.9 per cent, last year, by 21.4 per cent and this year, is estimated to increase by 19.5 per cent. Now, why is this happening, Sir? Is this happening because we are collecting our past arrears, which we have been urging the Government to do? Of the Rs. 72,000 odd crores this year, the arrear collection is only Rs. 10,000 crores. (Contd. by 1R/KSK)

KSK/12.20/1R

SHRI SITARAM YECHURY (CONTD): Where is the rest of this money coming from? And, that is where my second general point is, Sir, and it is a matter of serious concern. This amount of money, that is coming, is not really coming through any increased additional tax mobilisations; it is not coming through arrears being collected from the past, but much of it is coming through, what I would call, is because there has been a squeeze that is taking place on the vast masses of the Indian people. Why I am saying this, Sir, between 1993-94 and 2003-04, if you look at the bottom 80 per cent of your rural population, their per capita expenditures have declined according to the NSS Surveys. On the other hand, you have a per capita income growth of around 4 per cent annually. For 80 per cent of your rural population, if their per capita expenditures are declining and there is an overall increase on the average of 4 per cent for the rest of the people or the economy, that shows you the extent to which income inequalities have widened which, in other words, means that the pre-tax surpluses for the rich have increased dramatically, and that is why, you have this windfall of increasing tax revenues. So, the important point to understand here, Sir, is and I quote what the Finance Minister has said in Lok Sabha while replying to the discussion. He said, "Growth will be our mount; equity will be our companion.'

THE MINISTER OF FINANCE (SHRI P. CHIDAMBARAM): You have left the last part of it.

SHRI SITARAM YECHURY: No, I am coming to it. "With growth, there is a chance for equity, and without growth, I am afraid, there is no chance for equity." Sir, I will be fair. I will not misquote you or pick up quotes out of the context. I have quoted in full what you have said. My point is that growth that is taking place is at the expense of equities. And, if that is the type of growth that is taking place at the expense of equity, then, this is worrying, Sir. Because these windfall tax collections that we are finding and an increase is because of the squeezing of the people at the bottom, and the net surpluses in the hand of the rich have increased. That is why, there is this windfall in the collections and that is where it is necessary for you to intervene in order to ensure that this squeezing doesn't increase in the days to come. In fact, it is reversed. Now, if that is the objective, which, I think, is the objective also in the Common Minimum Programme, then, the massive outlay increases in the areas of employment generation, in the areas of your rural sector will have to be explored. Now, regarding the flagship programmes, what the Finance Minister announced at the outset sounds very impressive. He said that the additional allocations for the flagship programmes have been increased by 43.2 per cent, or total growing from Rs. 15,000 odd crores to Rs. 50,000 odd crores. But, of this, what is the net growth? That is where they are saying, you have the National Rural Employment Guarantee Scheme that is coming into place. But, as that is being introduced, the Food-for-Work Programme has been abolished. For the Sampoorna Grameen Rozgar Yojana, the allocations have been drastically reduced. So, the net increase from our calculations in rural employment comes to only to the tune of Rs.3388 crores. Now, I want to link this with the overall situation that I have talked of earlier. With a tremendous increase in the pre-tax surpluses, the opportunity for you to raise greater resources was there, and is still there. And, one of the things to which I want to draw the attention of the House, and the Finance Minister through the House, is a fact that we have a very anomalous situation in our country where the poor middle-class salaried section is bearing the burden of paying the taxes and you can earn hundreds of crores of rupees in the stock market through dividends and not pay a single paisa of tax. This is something we cannot afford. When we talk of a long-term capital gains tax, yes, the Finance Minister has also explained otherwise outside the House also, and here is a concrete problem involved. That was the Double Taxation Avoidance Treaty that you have with Mauritius. Now, Sir, I want to raise this in the House. I want the Government to seriously consider reviewing that particular Treaty. Because, what is happening - hundreds and thousands of crores of rupees are flowing through the Mauritius route coming into India, and they do not pay a single tax because of that Treaty. Now, double taxation avoidance is a Treaty between two friendly countries, where an entity or an individual pays the same tax in both the countries. In order to avoid paying the same tax in both the countries, there is an agreement to avoid double taxation. Now, Mauritius does not have a capital gains tax. So, how is it double taxation avoidance? It is actually a double taxation permission being given to avoid taxes. And, if Mauritius does not have a long-term capital gains tax, the same entity must be asked to pay the tax in one of these two countries, and that is, in India. (continued by 1s)

GSP-PSV/12.25/1S

SHRI SITARAM YECHURY (CONTD.): So, we think that this is a very anomalous agreement that has to be reconsidered by the Government. I think, they have extended it also now to Singapore in which case you will have the situation where people can make crores and crores of rupees, hundreds and thousands of crores of rupees without paying a single paise of tax, and, that is not permissible or admissible. So, we would warn this Government to seriously think over reconsidering the treaty with them. Sir, with all these flagship programmes etc., we think, a tremendous amount of potential was there to increase the allocations to actually meet the aspirations of the people and to meet the commitments that we have made in the National Common Minimum Programme, and, that opportunity, unfortunately, has been lost. And, if the process of correction is still there, we want that to be taken up at this stage.

Secondly, Sir, the National Rural Employment Guarantee Scheme was brought into being after tremendous discussions and pressures, where all of us were also involved, and, the primary objective was to give employment and, thereby, generate greater demand in the economy through giving purchasing power to the people through this programme. Now, what would this mean? If there is more money flowing in the hands of the people, which is very good, which is what has to be done, i.e. increasing their purchasing power, then, the demand for food will increase. If the demand for food ought to increase, then, what should be the concomitant next step that has to be taken to strengthen your public distribution system? Sir, instead of that, what we find in the Budget is that the food subsidy which is now Rs. 24,200/- crores, was Rs. 26,200/- crores in the last Budget, and, what was actually spent was only Rs. 23,200/- crores. So, in other words, the food subsidy has not been increased or even attempted to be increased in line with the NREG Scheme which will increase the purchasing power in the hands of people in the rural areas and that purchasing power cannot be translated into purchase of foodgrains. Now, if this is not increased, what does it mean, Sir? There can be two things. Either, the Food Corporation of India and its procurement will remain at the level where it is, in which case it is inadequate to meet even the existing demand -- and, you are importing wheat today, or, the other course of action would be to raise the prices of foodgrains. And, that is precisely what this Government attempted to do, and, we, apart from everybody else also, take the credit for forcing the Government not to go ahead with that.

So, Sir, the net result of all this means that if you are sincere about implementing your NREG Scheme, then the concomitant has to follow that you will have to expand your public distribution system and the consequent rise in the purchasing power in the hands of the people will reflect in an increased demand for foodgrains, and, if that is not met, then the foodgrains prices will have to be raised, the entire purpose of giving employment and through that greater purchasing power would be defeated.

So, the whole purpose of going into this entire exercise is actually not only halting but, I am afraid, will also lead to a reversal of this situation and that is something which will go contrary to what the National Common Minimum Programme had promised. Now, if that is the case with the major chunk of the area, that is, with regard to rural employment and food, what is there in the sectors of health and education? That has been discussed here. I do not want to labour on that issue. But the increases that have been promised have also not been very substantial. In fact, in the Health sector, as a percentage of GDP, it goes up from 0.25 per cent to 0.30 per cent. In education, it goes up from 0.33 per cent to 0.52 per cent. Now, if this is the state of your social sector, where you are taking of rural employment, public distribution system, food subsidies and education and health, the most important concern for all of us and for our country has been, and, is also our agricultural sector. In the agricultural sector, Sir, today when you have these distressed suicides continuing, when you have starvation death reports still alarmingly coming through, we see a welcome trust, that has been there in the Budget, to reduce the interest rates and expand the credit facilities. But reduction of interest rates to 7 per cent is far, far short of what was recommended by Dr. M.S. Swaminathan Commission that was appointed by this Government. The recommendation was that the interest rate should be brought down to four per cent but that does not happen. There is a very important issue that has been brought out and that is the question of import duty on raw cotton. Many of the suicides that have been committed are by our cotton farmers, and, there have been demands including from the Congress Chief Ministers. I can see Mr. Jairam Ramesh smiling from there, because he is from Andhra, and the Andhra Chief Minister is on record saying that import duty must be there in order to protect your domestic farmers. (Contd. by SK-1T)

SK-1t/12.30

SHRI SITARAM YECHURI (CONTD.): But that has not been done. Then, Sir, the Swaminathan Commission also suggested the extension of crop insurance to all areas and all crops. That has not been done. The Swaminathan Commission talks of a price stabilisation fund. That has not been done. The question of expanding credit in rural areas is also there. The expansion of credit in the rural areas is possible only when your financial institutions and banks expand their branches in the rural areas. Now, there is a curtailment of that expansion and there is an increase of saying that we will not go up to Rs. 1,75,000 crores in terms of agriculture credit. Unless you have the conduits to reach that to the farmers, it does not and will not reach. The Finance Minister himself is on record to say that only 27 per cent of our farmers today has access to the institutional credit. And, many of your distress suicides are because of stranglehold of your moneylenders and mahajans. Unless that is broken, we cannot do this. I would urge this Government to immediately start moving in this direction of expanding credit in the rural areas. I will just take two minutes, Sir. These are the areas which I want this Government to seriously consider because you cannot have a Budget and its provisions which ostensibly talk in terms of the National Common Minimum Programme and its objectives, but in effect and reality, actually undermine the realisation of the same goals. And, that is where, I think, there is another area which needs to be drawn to the attention of the House and that is the question of the framework in which this Budget has been done. That is also a matter of concern. That is the framework of financial liberalisation that I am talking of. A decision has been taken to allow foreign institutional investors to buy Government securities at much higher level than it was before. That is bringing in international speculative trends into our Governmental finances. Secondly, mutual funds have been allowed to invest abroad. Thirdly, Sir, what is of concern to me is that the peak customs duty has been reduced from 15 per cent to 12.5 per cent across the board which will have a very, very negative consequence on your small producers, and, therefore, also the employment that these small producers provide in the country. You have now added 180 items further for de-reservation. This is going to affect your small-scale sector, which all of us know, after agriculture, is the largest employment provider in our country. And, you have de-reserved 180 items further. Another important aspect, though the Finance Minister has said that the finances of the States in the union have been much better than ever before, under the normal Central assistance under Plan grants and loans, it is very interesting to see that the last year's Budget gave Rs. 13,541 crores. The Revised Estimates gives you Rs. 12,044 crores. And now, that has been reduced to Rs. 10,916 crores. If your assistance to the States under this head, under normal Central assistance under Plan grants and loans, if this is reduced, you will be leaving the State Governments with no option but to become prey to the various conditionalities that the international agencies like the World Bank and the ADB will pressurise on them. And, they will have to go there out of sheer lack of any other alternative which will be disastrous for our country and its economic sovereignty. So, therefore, Sir ...(Interruptions)..

SHRI V. NARAYANASAMY: Bengal is also getting money from the ADB. ...(Interruptions)..

SHRI SITARAM YECHURI: Yes, we are getting money, but on what conditions? That is what I am saying. Now, you are making the States ...(Interruptions).. Mr. Narayanasamy has raised this question and I take this opportunity to answer you back also.

MR. DEPUTY CHAIRMAN: No, no, that is not necessary.

SHRI SITARAM YECHURY: No, no, let me, Sir. Let me, Sir. The point I am making, Sir, is that the Bengal Government today is in a position to resist the pressures of the World Bank and the ADB and we accept loans only without any conditions and strings attached. And, don't make, not only Bengal, but your Government or all other Governments also, vulnerable in a situation where they will have no other options but to accept the strings attached. And, that is not in the interests of my country or its economic sovereignty. Therefore, I would like the Finance Minister, who is here, through you, to actually pay attention to all these areas. Probably this Finance Minster has been fortunate to have an economic environment which, I think, is very enviable for the Finance Ministers otherwise. (Contd. by ysr-1u)

YSR/12.35/1U

SHRI SITARAM YECHURY (CONTD.): An eight per cent growth rate; Sensex crossing 10,000 point; a 29 per cent savings rate; and a 31 per cent investment rate. But 31 per cent investment rate, and particularly this 29 per cent savings rate is all happening because of the squeezing of the people at the bottom and not really because of an overall economic growth that there is greater prosperity in the country.

Finally, Sir, I come back to my original point that the growth that has taken place in the last 4-5 years, which have seen a tremendous windfall in terms of gross tax revenues increasing by the percentages that I have pointed out, has been the growth that has taken place at the expense of equity, not growth which will lead to greater equity. And unless this is reversed, Sir, through active State intervention, I think the objective of achieving what we ourselves have declared -- when I mean "we ourselves," it is the Government itself that has declared -- as the National Common Minimum Programme priorities, those would be undermined. Therefore, we would urge, through you, to the Government, even at this stage when we come to the question of the Finance Bill, to reconsider the possibilities of expanding further your tax net in order to utilise these opportunities, so that we can tangibly give relief to the people at the lower level. And it is that corrective which, I hope, the Finance Minister will undertake when he replies. Thank you, Sir. (Ends)

THE MINISTER OF FINANCE (SHRI P. CHIDAMBARAM): Mr. Deputy Chairman, Sir, I am grateful to the 29 hon. Members, beginning with Mr. Yashwant Sinha, who I find is not here, and ending with Mr. Sitaram Yechury, for participating in this debate.

MR. DEPUTY CHAIRMAN: It is thirty.

SHRI P. CHIDAMBARAM: Thirty, Sir.

(MR. CHAIRMAN in the Chair)

I think we have had a range of opinions, ranging from the Right to the Left, and I think that has enriched the debate. I am sorry I was not present for large part of the time, because of my obligation to be present in the Lok Sabha. But as soon as I completed my reply in the Lok Sabha, I came to this House. I have, of course, gone through the major points made by everyone. In fact, I have read every line of Mr. Yashwant Sinha's intervention, and I have heard every word of Mr. Yechury's intervention.

Sir, broadly, I wish to address the House today on the issue of Economic Policy, the philosophy behind the Budget, and the direction in which we think that the economy is headed. Questions relating to the Finance Bill can be answered, Sir, with your permission, when we reply to the debate on the Finance Bill. Those are really technical issues and tax-related issues. I will certainly take on board the suggestions made by the hon. Members, and in my response to the debate on the Finance Bill, I will address those concerns.

But, today, Sir, I wish to give a broad overview of how the U.P.A. Government wishes to manage the economy and where we think that the economy is headed. Sir, we believe that a lot of ground was lost during the six-year-period of the N.D.A. Government. Not that there were no programmes or projects or achievements, but overall in the management of economy, there have been major lapses as a result of which we have to get back to the path of prudence. Let me illustrate just by one figure.

In 1997-98, the fiscal deficit was 4.1 per cent. In the last year, according to the Revised Estimate, the fiscal deficit was 4.1 per cent. Now, what does that mean? It means that in the intervening period, the fiscal deficit deteriorated sharply, and then the correction started only in 2002-03, and we have now brought it back to the level where it was in 1997-98.

(Contd. by VKK/1W)

-YSR/VKK/1w/12.40

SHRI P. CHIDAMBARAM (CONTD.): That means that much ground was lost and our ability to garner resources for capital investment was also lost. I have the figures of how the fiscal deficit moved from year to year and the figures make for rather painful reading. If you look at the movement of the fiscal deficit, you will find, Sir, after touching a low of 4.1 per cent in 1996-97, it climbed to 6.2 per cent in 2001-02. Then, the correction began and last year, we restored the position at 4.1 per cent. Why do I place such emphasis on fiscal deficit? Out of this fiscal deficit, the largest component is revenue deficit. The difference between fiscal deficit and revenue deficit is the space available for capital investment. If the space is a limited space, then, the opportunity for capital investment, the potential for capital investment, is also low, which is the reason why Parliament has adopted the FRBM Act and that says, the revenue deficit must be wiped out by 2008-09 and the fiscal deficit must be brought down to three per cent. Fiscal deficit of three per cent is certainly something which we can tolerate and live with. But if the revenue deficit is wiped out, then, we have three per cent of GDP available for what we call 'capital expenditure'. So, some ground was lost in the NDA Government. We are trying to retrieve the ground. And I believe, we have. We have retrieved much of the lost ground. The fiscal deficit of 2004-05 according to Revised Estimates is 4.1 per cent and the fiscal deficit for 2005-06 also according to Revised Estimates will be 4.1 per cent and the fiscal deficit for the next year will be 3.8 per cent. And I am confident that we are on target to bring the fiscal deficit down to three per cent. These, of course, may appear to be technical jargon. But, in plain language, what it means is, we must garner three per cent of GDP of a capital investment. Unless we have three per cent of GDP for capital investment, we cannot raise growth rates in agriculture nor can we raise the growth rates in manufacturing. The goal, therefore, is to wipe out the revenue deficit, garner three per cent of GDP -- in a growing GDP, three per cent of GDP is a larger number -- and make sure those resources are available for public investment in agriculture, in manufacturing and in the social sector. Now, how do we wipe out the revenue deficit? If you don't wipe out the revenue deficit, what it means is, what you are borrowing is going for consumption expenditure and revenue expenditure. There are two ways to wipe out the revenue deficit. One is based on expenditure control and the other is by revenue enhancement. Expenditure control has very heavy costs and consequences. Some expenditure control is, indeed, desirable. There is a lot of wasteful expenditure in the Government and we must make every effort to keep wasteful expenditure under check. You will find that for the Budget for the next year, the non-Plan expenditure rises by the smallest amount in many years, 5.5 per cent. We are exercising tight control over expenditure. But if you slash expenditure too much, where will the axe fall? The axe will fall on education; the axe will fall on health care; the axe will fall on food subsidies; the axe will fall on fertiliser subsidies; the axe will fall even on defence. So, we can't take expenditure control to such a point where necessary expenditure is slashed. Therefore, while expenditure control is certainly an instrument to wipe out the revenue deficit, the more appropriate method is to enhance revenues. Now, the last speaker was critical about my efforts to enhance revenues.

SHRI SITARAM YECHURY: I am not critical. I am asking, how it happened.

(Followed by RSS/1x)

RSS/1x/12.45

SHRI P. CHIDAMBARAM : Let us look at the figures. Let us look at the gross tax revenues. Let me not talk about the gross tax revenues because those figures are really the share of the State Governments. Let us look at the Central Government revenues. I will come to the State Governments' share later. Tax revenues net to the Centre in 2005-06 increased by Rs. 45,187 crores in the Budget Estimates. In 2006-07, according to the Budget Estimates, it will increase by another Rs. 55,000 crores. After providing for the States' share, the Government of India is able to raise for itself revenues of Rs. 45,000 crores in one year, and Rs. 50,000 crores in the next year.

SHRI SITARAM YECHURY: Rs. 53,000 crores.

SHRI P. CHIDAMBARAM: Well, Rs. 55,000 crores, according to me. If you take BE to RE, it is Rs. 55,000 crores; if you take BE to BE, it is Rs. 53,000 crores. But, now, Sir, RE figures are available, so I am taking the RE figures. Broadly, Sir, between Rs. 45,000 to Rs. 55,000 crores. Now, I think, Rs. 45,000 crores or Rs. 55,000 crores is a commendable revenue effort. Can you raise more? Mr. Yechury thinks, we can. I think, we cannot, and even if I concede for the sake of argument that we can, I think, we should not, and I will tell you, why?

SHRI SITARAM YECHURY: Sir, Let me clarify. I am not disputing the commendable effort in increasing the gross revenues. I was only stating the point that why it happened. That is my concern.

SHRI P. CHIDAMBARAM: I am answering. Sir, today, farm income cannot be taxed by the Central Government. So, that is ruled out straightway. It is only the rural non-farm income which can be taxed, and the rural non-farm income is, indeed, being taxed. If someone owns a cinema hall or someone owns a rice mill or someone runs a transport company, that is being taxed. So, it is wrong to say that the rural rich are not being taxed. The rural agricultural rich are not being taxed because that is beyond the purview of Parliament. In fact, those who ask me: "Why don't you tax the rural rich?" I give them this constitutional answer; I also give them a political answer. I say, if you are so determined that the rural farm rich should be taxed, why don't you ask the State Government to tax the rural farm rich? No State Government is willing to tax the rural farm rich. (Interruptions)... I am coming to that, just a moment. Well, my learned friend says, Subroto Bose, including Bengal. Be that as it may. We can only tax the manufacturing sector, the services sector. Now, the bulk of revenues--why bulk-- barring about Rs. 35,000 crores, the entire budgeted non-tax revenues of the Central Government of Rs. 4, 03,465 crores is coming from the industrial sector or the manufacturing sector. Customs duty, excise duty, income tax, barring, of course, a salaried section, and corporation tax, is coming from the manufacturing sector/industrial sector. But, our economy has undergone a very remarkable transformation. Approximately, 54 per cent of the GDP is now accounted by services. The services sector does, indeed, pay some corporation tax, and some income tax. But, in comparison with the manufacturing sector, the services sector does not pay enough tax. That is why, we are expanding the services tax net, and I will explain presently why we had to raise the rate of service tax. Today, it is the industrial sector and the manufacturing sector which are contributing the overwhelming part of our gross tax revenues or net tax revenues which I want to tell you. Now, that is growing at an average of 20 per cent every year, after the UPA Government came into office.

(contd. by 1y)

MKS/SC/12.50/1Y

SHRI P. CHIDAMBARAM (CONTD.): Mr. Yechury read some figures, but there are some years where it increased only by one per cent, and there are some years where it increased by 5.9 per cent. There has never been a three-year period where tax revenues are increasing by 20 per cent year after year, three successive years. We have accomplished that without killing the incentive for investment.

Sir, there is a point, there is, I believe, an inflection point beyond which if you tax the manufacturing sector and the industrial sector, that will kill the incentive to investment. Today, look at figures. Look at the IEN figures of the Department of Industrial Development. Look at the CMI figures of investment intentions, investment proposals and actual investment. Look at the growth, the non-food credit growing at 25 per cent. And last year, it grew by 30 per cent. Look at the major investment announcements by steel companies, by refineries and by petroleum companies in the textile sector, in the automobile sector. Look at the spate of announcements made by the major industrial houses. I believe that there is an investment boom in this country. The incentive for investment is still high; business houses, mainly Indian, and some foreign, are now committing themselves to larger and larger investment. At this point of time, I think, it is extremely important to keep tax rates stable, to keep tax rates moderate, even while mobilising a 20 per cent increase. If, by keeping the tax rates stable and moderate, I am mobilising less than 20 per cent, the criticism is perfectly well founded. If I am able to mobilise 20 per cent growth and 20 per cent more revenues this year, than last year, which was 20 per cent more than the previous year, I believe that we have been able to strike a balance between the revenue mobilisation and the need to incentify investment and I think garnering Rs.50,000 crores a year by additional revenue is not an easy task. It is a task that has to be performed with a certain balance between the need for revenue and the need to ensure that the incentive to investment is not killed.

Shri Yechury talked about arrears. Show me any other three-year period where we have collected more revenues. We are collecting arrears. I have given the figures for the arrear collection in 2004-05, and at the end of 2005-06, I will come back to Parliament and tell you what the real collections are. This is the largest amount of arrears collected in any year. But, again, it is not as if every arrear is collectible. There is a court system, there is an adjudicatory system; at every level, the orders are granted by the authorities, the appellate authorities, the Tribunal, the High Court and the Supreme Court. For example, one item of these arrear documents is Harshad Mehta arrear. Now, where do you collect it from? There are Rs.28,000/- crores, or so, Harshad Mehta arrears. Now, this is locked in litigation in so many forums. Unless this litigation is resolved, there is no way you can collect this Rs.28,000 crore? But, I think, what is important is to look at the collective arrear demand and what we are collecting. And I believe that the Department is collecting more arrears than ever before. The cost of collection of my Department is the lowest in the world. It is 0.86 per cent. For every hundred rupee of revenue collected, the cost of collection is eighty-six paise; it is the lowest in the world. Therefore, I believe--and I owe it to my Department to pay a tribute to the revenue collection machinery--they are collecting arrears, they are collecting revenues, they have done an exemplary job in the last two years, and I believe, if we continue to grow our GDP by 8 per cent, if we continue to grow our revenue growth rates at, say, about 20 per cent, enough resources will be available in this country to meet the needs of our economy, of our people.

Now, let me come to resource allocation. There is always a complaint that resources are not allocated to this sector or that sector; I agree. Given the needs of India, 'any allocation' will be inadequate. How can there ever be an adequate allocation in this country? Allocations always fall short of expectations. Even if it falls short of objective requirement of the sector, I am the first to agree that the primary education needs more money, secondary education needs more money, higher education needs more money. (Contd. by 1Z)

TMV-ASC/1Z/12.55

SHRI P. CHIDAMBARAM (CONTD.): I would be the first to agree that health requires more money. But the point is the absorptive capacity of the system is limited. Year after year, why do I find that the Ministries do not spend the money allocated to them?

Sir, just look at the last page of the expenditure document, the dark red volume, or look at even the summary of "The Budget at a Glance". You will find that Department after Department, Ministry after Ministry, finally returns money at the end of the year. That is why you will find that the Actuals are always better than the Revised Estimate. The actual figures are always better than the Revised Estimate and my fiscal deficit comes down by 0.1 per cent, after the Revised Estimate is presented, even for this year. While I projected a revenue deficit of 2.6 per cent and a fiscal deficit of 4.1 per cent, I was, more or less, certain, going by the experience of the last two years, when the Actuals come in, they may even drop to 2.5 per cent and 4.0 per cent respectively. Why? I don't think that the fault can be put entirely at the door of the Central Government Ministries and Departments. After all, the Central Government can spend through the State Governments. Monies are released according to certain procedures. You have to submit the utilisation certificates. First of all, you have to submit the plans; they have to be approved; monies have to be released; you have to submit the utilisation certificate before further monies are released. Now, what is the position today? As of three days ago, the State Governments have a balance of Rs.45,000 crores. We are in the middle of March. We have two more weeks. The State Governments, today, are sitting on a cash balance of Rs.45,000 crores. I don't wish to embarrass any of the hon. Members representing the States. They represent the States in the Council of States. Every State, today, is sitting on a huge cash balance. There are States with cash balances of Rs.3,000 crores, Rs.4,000 crores and Rs.5,000 crores. Why are they not spending? I have been urging the State Governments to spend. At the end of the year, if they don't spend, surely, further money that should have been released to the State Governments by 31st March under a particular programme will not be released. The message that I wish to convey to the States, through this House, is, please begin to spend next year from the 1st of April. Traditionally, there is the habit of State Governments not spending in April, May and June saying, "We don't have money; we don't know how much money will come; we may run out of money". By the time they get their acts together, three months go by.

Sir, in the first year of the UPA Government, we devolved to the States Rs.75,000 crores, as share of their taxes. In the second year, we devolved Rs.94,400 crores. In the next year, we will devolve Rs.1,13,448 crores, a whopping increase of Rs.30,000 crores over this year's devolution. So, the State Governments must begin to spend on the first day of April. They have enough money. Enough money will be provided and they spend even on the first day of April. If they do that, you will find that many of the targets are achieved, including the financial targets and the physical targets, and that will mean more money in the hands of the people.

As far as the Central Government is concerned, our cash management system is better and better. We are forcing the Central Government Ministries to spend, at least, 66 per cent in the first nine months and if they don't spend, we have told them that they will be penalised. Therefore, more Ministries and more Departments are able to spend 66 per cent in the first nine months. You look at the Plan expenditure of the current year. The Plan expenditure in the current year--you know better, Sir, having presided over the destiny of a State for many long years--is running ten percentage points higher than last year. At this point of time last year, the Plan expenditure, at the end of December, was about 55 per cent. This year, it was 65 per cent. That means that the Central Government Ministries and Departments are geared to spend better. Even States are spending better. That is why the Plan expenditure is running at 65 per cent. The idea is that we must garner more revenues. We must keep the tax rates stable and moderate and garner more revenues, allocate more to the States, encourage them to spend according to a Plan even at the beginning of the year, spend the entire money allocated, ensure that the financial targets are achieved and then measure the physical outcomes against the financial targets. That, I believe, is the virtuous way to go about increasing the purchasing power in the hands of the people.

(Contd. by 2A/VK)

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