THE MINISTER OF DEVELOPMENT OF NORTH EASTERN REGION (SHRI MANI SHANKAR AIYAR): Sir, I beg to lay a statement on the status of implementation of recommendations contained in the Hundred and twentieth Report of the Department-related Parliamentary Standing Committee on Home Affairs. (Ends)





DR. K. MALAISAMY: Sir, I am told that the national banks are not faring well and they are able to survive because of the Budget support given by this Government. When the national banks are not faring well, what are you going to do? What is the package that you are likely to give to such banks to solve their hurdle or problems? Again, I am told that you are getting the maximum revenue, around 54 or 58 per cent of the total receipt, from the service sector. The service sector mainly consists of private people. I am told that the service sector may not sustain for long in view of the heavy taxation on them. I am not a mouth-piece for them, but I am told that the major receipt from the service sector is likely to go down in due course. I am bringing it to your notice. Coming to the retail sector. Sir, in the retail sector foreign entry has been started. If that be the case, the poor people who are employed in the small shops will go out of employment. Will they be able to sustain this foreign competition? This is my point which I want to bring to the notice of the hon. Minister. In short, Sir, I try to tell that it is the lack of priority and the lack of allocation to very important sector. Even if allocation is given, it is inadequate. Another point is with reference to the States because they are giving a lot of money to the States. Many times, States depend upon that. I read in the newspaper as to what he said in Tamil Nadu. He announced free TV distribution and free land to landless poor. These are the two schemes which are in existence in Tamil Nadu after this new Government came to power. I would like to ask the hon. Minister whether it would be possible. I correctly remember -- I read in the newspaper -- that the hon. Minister seems to have said that this kind of scheme would be possible. If that be the case, I would like to hear from his mouth as to how this would be possible. Lastly, Sir, as a well-informed Minister, he must know what is meant by three P's. First P stands for planning, the second P stands for preparation and the third P stands for performance. In a budget like this, you not only need to be a planner, you must do preparation and performance also. In that situation, I would like to give one or two suggestions for doing well. ..(Interruptions).. First is efficient self-reliance. Instead of relying on others, we should rely on self. Secondly, you rely more and more on domestic resource mobilisation rather than depending upon elsewhere. You have rightly said, 'to unearth the black money and all'. Still, there is a lot of scope to do well. Please do that. Thirdly, adequate protection to PDS and social sector. Sir, I need efficient management of public enterprises instead of selling them in the name of private participation. (Contd. by 3z/SK)


DR. K. MALAISAMY (CONTD.): Sir, what I mean is, efficient management of public undertakings and banks, etc., should be there. How you could do that, I leave it to you. Then, last but not the least...

MR. DEPUTY CHAIRMAN: How many times will you say 'last'?

DR. K. MALAISAMY: There should be decentralisation of power, delegation of power, rationalisation and simplification of procedure so that you can ensure efficient administration. Sir, very importantly, you have to review and evaluate Ministry-wise, programme-wise and Department-wise, so that, whether you Budget has been rightly (Time-bell) used or not. If so, how the measures can prevent such things.

MR. DEPUTY CHAIRMAN: Please conclude, Mr. Malaisamy.

DR. K. MALAISAMY: Since you have given several bells, I conclude it. Thank you, Sir. (Ends)

SHRI MATILAL SARKAR (TRIPURA): Sir, I extend my support to these two Appropriation Bills brought forward by the hon. Finance Minister. Sir, while going through the... Sir, shall I raise half-an-hour discussion?

MR. DEPUTY CHAIRMAN: No, no. Your name has been replaced with Mr. Moinul Hassan. So, I am calling you.

SHRI MATILAL SARKAR: Sir, so far as the Supplementary Budget is concerned, we see that the agriculture sector has further been neglected. In the original Budget also, the Budget was not adequate. There was no sufficient fund for irrigation. There were no sufficient funds for giving redress to those who committed suicide. Here also, we have seen that there is not enough scope for the agriculture sector. So, what we have to think is: Shall it remain our policy even after so many farmers have committed suicide. So, I invite the attention of the hon. Minister to provide more funds for the agriculture sector. Uptill now, even after 59 years of independence only 40 per cent of land is irrigated and 60 per cent of land is still due for irrigation. This sector has to be taken care of.

Sir, coming to the North East, we have seen--of course, I shall raise the points, in this regard, in my Half-an-Hour Discussion also--funds are not allotted according to the projects submitted by the State Government. And, whenever the State Governments submit a project, these are curtailed and shortened. The allotted funds are also not released in time.

Sir, with regard to rural development, our States of Tripura or Mizoram or Meghalya, are smaller even than some districts of big States like U.P. or Bihar. Ours is a State. But in size and population, it is smaller than one district of some other States. So, what is the problem to take up the whole district under the Rural Employment Guarantee Programme? I further emphasise my demand that all the districts of Tripura and other North Eastern States should be brought under the purview of this scheme, without waiting for further three or four years, because we are performing very well. (Contd. by 4a)


SHRI MATILAL SARKAR (CONTD.): I think the hon. Minister of Rural Development will appreciate how we are doing.

Regarding food, in our State, we see that rationing, supply of foodgrains, is very irregular, particularly sugar. Sometimes it happens that the whole month passes away, but sugar does not come.

Regarding price rise, no effective decision has yet been taken to combat rising prices of essential commodities. These are some of the points that I wanted to bring to the notice of the hon. Minister.

The most important point is unemployment. It is due to unemployment that terrorism and extremism are growing. One main important point is that they are not getting employment. In the rural sector, eleven crore people are seeking employment. In the urban sector, among educated youth, the number exceeds five crore. About 40 crore people have the ability to work. Among these 40 crore people, above 16 crore people are unemployed in the rural and the urban sector. It means above 40 per cent of those who can contribute and work for the nation, they are not getting employment. Of course, the Government is trying to do its best, but, in my opinion, this unemployment problem should be given more importance, because it is at the root of our development. Sir, with these few words, I conclude. Thank you.

ֵָ : ָ, ֕ Ùև דָ֤ ֱֻ כ ֱֻ ?

ֳ֯ן : ָָ , כ, ׸և ֺ ...(־֮֬)...

SHRI MATILAL SARKAR: Sir, in this House, I urge upon the Government that the demands raised by the working people should be taken into consideration. (Interruptions) (Ends)

MR. DEPUTY CHAIRMAN: He motivated you.

ֵָ : ֱֻ ? և ״׮Ù ֱֻ ָ ״׮Ù ֱֻ ? ...(־֮֬)...

MR. DEPUTY CHAIRMAN: Please conclude. (Interruptions) Mr. Sarkar ..(Interruptions).. (Time-bell) Shri Nand Kishore Yadav. (Interruptions) Mr. Sarkar, you have already concluded. (Interruptions) I have called the next speaker.

SHRI MATILAL SARKAR: The Government must fulfil their demands.

֮ ֤ (ָ Ϥ) : ֳ֯ן , ֯ - ֮־֤ ֮֯ ֮ ָ פօ ׾׮ֵ (ܵ 5) ׾֬, 2006 ׾׮ֵ (ܵ 6) ׾֬, 2006 ִ֣Ԯ ֮ ׻֋ ֛ , ֲ ָָ ֮, ֲ ָָ ֛ ֿ Ӭ ׾ֿ , ֿ Ӭ ָָ ֮ ׻֋, ָ ׻֋ ִ ִ ߅ ָ ָ֕ ָ ָ֕ , ִ ֟ , ָ ָ֮ ? (4 / ָ ֿ:)


֮ ֤ (֟) : ׮׿֟ ֲ ָָ և , ָ ָ֕ , ֯ ִ֬ ָ ָ֕ , פ ָ פ ָֻ֤ ִ , ָ߲ פ-֟ ֜ , ֤ ֟ , ָ Ӿ 71 ןֿ֟ ֤ ָ ֬׸ , ׾ ֮֮ߵ ׾֢ ӡ ֲ ֻ ֕֙ , ָ ִ ֓ , ֮֮ߵ ӡ ֮ - ؓ֟ֆ ֟ ֟ , ֮ ֟ ִ֯ օ , ָ ־ã ߜ , ִ ִ , ןֿ֟ ֙ , ֟ ֕ ֙ ִ ֵ ֕ Ը , ߕ , ߙֿ ֋ ֓և ־ã ֤֕ ֤ ֳ 60 ߟ ֋ , ֓և ֻ 30 ןֿ֟ 35 ןֿ֟ ־ã ֪ׯ þָ ֮֮ߵ ׾֢ ӡ ִ ִ ֲ ׯ֔ ֕֙ ֤ ֟ ָ ֲ ֮ ִ , ־׸ פև ֛ ֮֮ߵ ӡ ֲ ֓ ָ , ֟֋ ֮ ֟ ןֿ֟ ״ֻ ״ֻ ָ ֯ ֟ ֕ ֮ ֟ ֯ , ֲ ֳ ָ ֮ ֟ ϴ ָ ָߵ , ָߵ , ־֮ ָ , ֮ ָ ׮ֳԸ ָ ֜ ֟ ֛ ֟ ֮ ӕ ִ ֟ , ֟ ֮ ו֮ ׻ֵ , ֣֠ וֻ Ͽ֮ ߮ ֮ ߔ ֛ ֟ ָ ֮ ֟ ֲ֕ ֟ ָ ֛ ִõ ָ ֮֮ߵ ׾֢ ӡ ׮־ ֲ ָ ֕֙ , ׮׿֟ ָ , ֮ ָ ֤ ֤ ׾֬֋ ִ , , ָ Ϥ Ӥӛ , ׯ֔ ߮ ֮ ָ (4C/NB ָ ֿ:)


֮ ֤ (֟) : ֯ ִ֬ ֮֮ߵ ׾֢ ӡ ֯ ָ Ϥ ׻֋ ׾ֿ , Ӥӛ ָ ׯ֔ 3 ן ֤֯ և ׻֋ ֯ ִ֬ ֮֮ߵ ׾֢ ӡ ׮־ Ӥӛ ׻֋ ׾ֿ ٣ ִ ֮֯ ֮ ָ פ, ׻֋ - ֮־֤


MR. DEPUTY CHAIRMAN: Mr. Mandal. He is not here. Mr. C. Ramachandraiah. Kindly confine yourself to the time allotted to you. Four minutes is the time given. ...(Interruptions)... I am just reminding him.

SHRI C. RAMACHANDRAIAH (ANDHRA PRADESH): Sir, I rise to support these two Bills, The Appropriation (No.5) Bill, 2006 and The Appropriation (No.6) Bill, 2006, with some observations.

Sir, thanks to the earlier Government and the present Government, the first one which has created the edifice, and the second one which is maintaining the edifice in a sound condition, and which is responsible for achieving, continuously, a growth rate of around eight per cent for the past three years, and also in the current year. I hope that the Tenth Plan will achieve the growth rate near to the target--given all the fundamentals of the economy as now--there seems to be a sustained growth rate for the future also-- and fiscal consolidation also, with all the buoyancy in the revenues, and the increasing growth rate. The F.M. has said in a recent statement that he is trying to put the economy on the path of fiscal consolidations. I wish he should achieve it. And the things are on a correct path also. Unless some drastic changes which are most unlikely to come.....(Interruptions)...


SHRI C. RAMACHANDRAIAH: Yes, I wish him well, Sir. I wish him well.

SHRI P. CHIDAMBARAM: He wished me. But he said 'unlikely'!

SHRI C. RAMACHANDRAIAH: Concerning fiscal responsibility, FRBM, Sir, I have my own comments on this. Sir, you have been very ambitious to achieve the growth rate of 9-10 per cent. And ten per cent is the best, Sir. Otherwise, it is very difficult to eradicate the evils of poverty, illiteracy and ill health that have been plaguing our country for a long time. It is good that the FRBM target has to be maintained. But will it be possible? I am asking this because we are under tremendous stresses and strains, because it increases the inflows. Yesterday, I read one statement of the Prime Minister indicating that to achieve the increased growth rate, we are, rather, constrained to depend on private sector. I think, that is the inference I have got. And the F.M. has said that to increase the further flows into the kitty, he has to adopt some hard options. I think, I am correct. Some hard options have to be adopted to contain the expenditures and to increase the revenues. But one aspect which has to be taken care of by the Finance Ministry is that the fiscal responsibility equally relates to the proper spending of public money. Sir, I wish to draw the attention of the hon. Finance Minister towards the uneven progress that has been made in the Sarva Shiksha Abhiyan and the National Rural Employment Guarantee Programme.

(Contd. by 4D)


SHRI C. RAMACHANDRAIAH (CONTD.): Especially, this particular programme is being misused. It is not achieving the purpose for which it is designed and planned. I should say that these job cards which are being issued are being used as ATM cards. Rupees twenty or rupees thirty are being paid. I don't want to criticise. But this is the fact that is prevailing. If I can spare my job card, I will be paid Rs.25 or Rs.30. Most of the works are being executed by the machines. I am telling you this honestly. I am not able to quote the examples because of constraint of time. I don't want to elaborate. I will make some bullet points.

Sir, fiscal discipline should not be at the reduction of capital expenditure. Capital formation is very low and our objective is very high. Unless you have substantial capital formation, it is rather difficult to achieve the target. The continuing malice of the society in India is the rural-urban divide. It continues to be there in spite of eight per cent growth rate for four years. The economic inequalities continue to be there. The FM has to take some hard decisions and has to carry along with him his allies, which sometimes are creating some irritants.

Sir, inflation is another area of concern. I think my friends have already mentioned this particular point. You have increased the CRR from 5 per cent to 5.5 per cent. You have squeezed....


SHRI C. RAMACHANDRAIAH: Yes, it is the RBI. I should distinguish between the Finance Minister and the RBI. The CRR is a monetary instrument that is being used to contain inflation. (Interruptions)... You have gone on record by saying that the inflation is because of supply constraints, basically of food articles like wheat, pulses and other things. The Government should have initiated more steps to address this problem than indulging in knee-jerk reaction of increasing the CRR. As a layman, I have got my own apprehensions. By withdrawing more money from the market, from circulation, you are reducing the money at the disposal of the common man. People are already under-nourished. When such is the case, you want to make them to consume still less by purchasing less. Instead of replenishing the stocks and making available more stocks to the common man so that they can buy, you are withdrawing the money in circulation. Do you mean to say by reducing the purchasing capacity of the common man, which is already at the lowest end, you want him to purchase less and consume less? I don't think this will be the correct and the only solution. Whatever the inflation rate--the rate has been quoted at 5.4 per cent, 5.5 per cent, etc.--the FM said that the ideal rate was around 4 per cent. It is very good. Four per cent has to be kept. In a developing economy inflation is naturally an inevitable thing. Except in China, I have seen that in the developing countries the rate of inflation is a little bit high.

SHRI P. CHIDAMBARAM: China's is administered price. It is not a free market economy.

SHRI C. RAMACHANDRAIAH: Whatever be the market system we adopt, our people need food. They need clothing; they need shelter. Whatever be the policies that you formulate, we are prepared to support you, as long as our people do not starve. (Contd. by VK/4E)


SHRI C. RAMACHANDRAIAH (CONTD): Sir, the rate of index of inflation is very confusing. This has to be reworked. Even the RBI has also recommended some harmonised indices. This is high time the Finance Minister has paid attention to it and a practical and realistic rate was worked out. The reality at the ground level is different as compared to the rate that is prevailing, which we are getting from the Statistical Organisation. This rate is not at all reflected at the ground level. The position is very dangerous at the ground level. I would like to say that a holistic and a comprehensive policy has to be there to contain inflation. Inflation covers five to six Ministries, the Agriculture Ministry, the Commerce Ministry and the Finance Ministry. So, who will be responsible to contain inflation in the country? I think a separate authority has to be constituted to continuously monitor inflation because we will be continuously achieving high growth rate. I wish it. We are going to do it. The strong fundamentals of the economy are correct portenders. If such is the case, inflation is going to be there. We should take care of the common man. To contain inflation, we should have a separate authority which can oversee all this; how much will be the production of cereals, how much will be the consumption; whether it will be deficit or in surplus. If it is deficit, how to procure it; if surplus, how to dispose it of. A comprehensive policy is needed, instead of indulging in knee-jerk reactions. You have allowed to import 6.5 lakh tonnes of pulses. I think, 50,000 tones have already been imported. Still you have allowed the private parties to import 6 lakhs tonnes. A lot of hoarding is there. Pulses are being sold at a very high price. What I am trying to suggest is, let there be a separate authority to monitor and take care of this inflation. We cannot hold responsible the Agriculture Minister; we cannot hold responsible the Commerce Minister and ultimately we cannot hold responsible the Finance Minister. Some Ministry, some Department or some authority should be there to contain inflation which is going to be there because of high rate of growth.

So far as commodity future market is concerned, there is a mixed reaction in the market. Because of the future transactions, the prices are going up. Though I don't subscribe to that, as far as my little knowledge goes, but it needs stricter regulation because it is an evolving market. Recently, I read in the newspaper that four traders have been suspended because of some delinquencies. It is better to study exhaustively about this future market transactions and try to control them; otherwise, if proper regulation is not there, it will very difficult to control it.

In regard to the CRR, I was told that 5.5 per cent of the deposits are being retained by the RBI under CRR. It is not a small amount. They are not carrying any rate of interest. What does it indicate? The banker has to earn income from the existing advances. Indirectly, you are advising him to increase the rate of interest. A practice was there earlier that they were entitled to get interest. Now you have stopped it. This is not a good regulation which has been made. It is better to do it for SLR. They can invest in Government securities. They can get interest. Your objective is to squeeze the money from circulation. In that way, you can ask them to go in for SLR. They can buy the Government securities and they can earn interest. Now these deposits seem to be NPAs for banks because they are not fetching any income. So far as the agriculture sector is concerned, it still continues to be an area of concern. In spite of the 8 per cent growth rate, this is the most neglected sector. To a certain extent, in the last Budget, the Finance Minister announced that in the next three years farm credit is going to be doubled. (Contd. By 4F)


SHRI C. RAMACHANDRAIAH (contd.): Sir, I had an opportunity to place before the House that the country required Rs.7.3 lakh crores of farm credit every year. Fifty crore acres of land are under cultivation, out of which 30 crore acres are under single crop cultivation and 20 crore acres are under double crop cultivation. So, they required Rs.7.3 lakh crores. Now, in the Tenth Plan, we made an allocation of Rs.7.4 lakh crores, but we could not achieve this target. Though you have targeted just 18 per cent, which is comparatively very, very less, excepting seven or eight banks, no other bank is achieving this. And there is no punitive action on them. These banks, which have not achieved this 18 per cent of their advances towards farm credit, can safely deposit the rest of the amount with NABARD and they will get their interest. It is not a punitive action. That is why bankers are not that conscious of it. The Government should have a commitment, and they should make the banks accountable.

Sir, the Indian farmers are very, very honest people, and their NPAs are very, very minimal, as compared to industries and traders in this country. When such is the case, when the banks are flooded with funds and the NPA is very low and they feel that they can earn more money in rural areas -- only last week, I read a statement of the Chairman of the ICICI, Mr. Kamath, that the rural areas are highly potential for bankers -- why are they lagging behind in achieving this 18 per cent growth rate which itself is a low target.

Sir, in spite of our growth rate, we require social stability. Unless there is social stability, there is going to be a revolution; honestly I tell you, Sir. Economic inequalities are widening like anything. Your Sensex indices are no indication of the economy; I never pay attention to that. Whether it is reduced by thousand points or is increased by 1000 points, the fundamentals of the economy are different. And, your eight per cent growth rate is being contributed by limited industrial houses. When this is the case, the rural-urban divide is more; economic class divide is more. Unless there is social stability, there is no use talking about it. In fact, excellently, this has been phrased, "Inclusive growth for Eleventh Plan". I do not know to what extent we can achieve this. An attempt is being made to have an agriculture-proof economy, and we have failed till today to have monsoon-proof agriculture. Even today the Indian agriculture is dependent on the vagaries of monsoon. But we have to make an attempt towards this, because continuously the contribution to the GDP from agriculture is going down. I was told that it is 19-20 per cent today. But this 19 per cent of the wealth that is being generated is being shared by 70-75 per cent of the population in this country. That is an alarming picture. So, if you want to make an attempt to create an agriculture-proof economy, you have to think over as to where this 70 per cent of the population should be accommodated, how their living needs would be met, how they would be provided with employment. Till such time this attempt should not be made.

With regard to reforms, we need more reforms. The Pension Fund Regulatory Authority Bill is there; we have submitted the Report. Also, the Banking Regulation (Amendment) Bill is there. Till now they have not presented the Report to Parliament. So, there needs to be some clarity on reforms. You are a strong votary of reforms; I appreciate it. But there has to be some clarity. You have to carry your allies with you. Ultimately the objective is to achieve the growth rate, for which they are also interested. When such is the case, where is the problem? Sir, my important submission is that there should be a national policy to see how to rehabilitate the affected persons.

(Continued by 4G)


SHRI C. RAMACHANDRAIAH (CONTD.): There should be a national policy. Lands are being purchased at a pittance, and those lands are being sold at exorbitant prices to industrialists. State Governments have become virtual brokers, killing the small farmer. There are instances where they buy land at the rate of Rs.35,000 per acres of land and sell it at the rate of Rs.35 lakhs per acre. There are instances... (Interruptions) Industrialists can straightaway purchase land from farmers. Why do they need Government intervention when farmers themselves are prepared to sell their land? Farmers are losing their land with which they have been associated for generations together. And, then, the industry doesn't mind paying some extra money also! (Interruptions) You see, setting up of an industry is welcome, but not at the expense of a common man. (Time-bell)

Sir, SEZ is a scandalous concept. We fully support the SEZs. We have supported it. We have been participating in the debate on the SEZs. But, Sir, even to an IT company, 500 or 600 acres are being alloted and, then, they are being allowed to sell fifty per cent of the land after development. These types of scandals are going on. That is why I suggest that a national policy should be there with regard to the rehabilitation of these people.

So, Sir, with all the observations that I have made, I support the Bill. I really wish India were created as a global source for goods, for knowledge and for services, which I hope, with all the contribution of Members from various political parties, can be achieved. (Ends)

SHRI RAHUL BAJAJ (MAHARASHTRA): Mr. Deputy Chairman, Sir, I was not planning to speak. But, after hearing all my colleagues here, I just want to make a few points.

I have heard a lot during the last two Sessions and today on agriculture and employment. There is no dispute that agriculture has to become different from what it is today. Today, it is not viable. It is subsistence farming. It has to change. Similarly, without employment, the country cannot move forward, neither can the industry. If there is no purchasing power in the hands of the people of this country, whom will I sell my products?

The point to be noted, Sir, and, through you, I would like to draw the kind attention of the House -- although the House is empty -- is the fact that in the developed world, we all know, the percentage of their population dependent on agriculture is very limited; it is less than three per cent. We have 60 per cent of our people in agriculture, contributing around 20 per cent of the GDP, as Shri Ramachandraiah said just now. Before the General Budget is presented, therefore, on a very macro basis, I would request, through you, Sir, that the Finance Minister should make it a very pro-savings, pro-investment Budget -- it is a very general comment -- because, Sir, if agriculture, over the next 20, 30, 40 years has to become really viable, you cannot afford 60 per cent of the population dependent on that. Shri Ramachandraiah asked how we would give employment. The only way is growth in the services sector and the industrial sector. If industry does not grow, if the services do not grow, I do not know how the people in agriculture will grow. It will remain a subsistence farming, a rain-fed agriculture, which cannot afford investment because we are dependent, as my friend said here, on Gods. So, I would like the House to recognise that, for agriculture to benefit, one of the things is that the number of people dependent on agriculture has to be substantially reduced, not overnight, but over a period of 10, 20, 30 or 40 years. They cannot migrate to some other countries. We will have to provide them good jobs in services and industry, Sir. But, for that to happen, the Budget for the year 2007-08 should be very pro-savings, pro-growth.

One small point is that, I think, there is no contradiction between agriculture and services and industry. If one of these pillars does not grow, we cannot have a good GDP growth rate.

(Contd. by 4h/tdb)


SHRI RAHUL BAJAJ (CONTD.): For a GDP growth rate of 10 per cent, I doubt, 14 per cent, today, what my friend, Shri Santosh Bagrodiaji said a little while ago...

SHRI P. CHIDAMBARAM: He talked about nominal GDP.

SHRI RAHUL BAJAJ: Okay, it was the nominal GDP. Fine. Not the nominal, but the real GDP growth, just at the inflation of 10 per cent, Sir, we have to have a 4 per cent agricultural growth rate. Having said this, I have a small point, Sir. This is because I am not familiar with the procedure of the Rajya Sabha. I support both the Bills. I have no further comment on the Appropriation Bill (No.6), but on the Appropriation Bill (No.5), I have to say something. You know, in the private sector, we don't function like this. We have this Bill for Supplementary Grants. I see that most of this Rs.3,300 crores is a capital account nature item for repayment of debts. Sir, the fact remains that this is not even, Sir, for 2005-06, but this is for the fiscal year 2004-05. It did not even come in the year 2005-06. It is coming at the end of the current year. Sir, there is a big gap. Maybe, the statistics were not ready or something like that. So, I would request, Sir, through you, the Finance Minister to enlighten an ignorant person like me as to why this 2004-05 item has come so late for approval. I support both the Bills, Sir.





MR. DEPUTY CHAIRMAN: I have to inform the Members that the Business Advisory Committee in its meeting held today, the 14th December, 2006, has allotted time for the Government Legislative Business as follows:-

Business Time Allotted

1. Consideration and passing of the Administrative Half-an-hour.

Tribunals (Second Amendment) Bill, 2006.

2. Consideration and passing of the Commissions Half-an-hour

for Protection of Child Rights (Amendment) Bill,

2006, as passed by Lok Sabha.

3. Consideration and passing of the following Bills,

after they have been passed by Lok Sabha:-

(a) The Central Educational Institutions 4 Hours

(Reservation in Admission) Bill, 2006.

(b) The Scheduled Tribes (Recognition of 4 Hours

Forest Rights) Bill, 2005.

(c) The Securities Contracts (Regulation) 3 Hours

Amendment Bill, 2006.




* Pp 562 Onwards will be issued as a Supplement.




THE APPROPRIATION (NO.6) BILL, 2006 (contd.)

THE MINISTER OF FINANCE (SHRI P. CHIDAMBARAM): Mr. Deputy Chairman, Sir, I am grateful to the hon. Members who have participated in this discussion. I shall briefly reply to their observations. I am especially grateful for the broad support they have extended to the Supplementary Demands for Grants as well as the excess grants. To take up Mr. Bajaj's point, in 2004-05, what we are asking for is regularising excess grants, i.e., the Ministries have spent a little more than what was approved by Parliament at the end of the third Supplementary Demands. And, when the Comptroller and Auditor General audits the accounts and he finds that a Ministry has spent Rs.50 lakhs or Rs.1 crore more than what was authorised by Parliament, after the CAG's report comes, then, we come back to Parliament and say, 'please regularise this excess expenditure'. The reasons have been given, if you look at the documents that have been circulated. The reasons for excess grants have been given. For each one of the items, reasons for excess grants have been given. For example, the bulk of it is really book entry, where there is repayment of debt under the debt swap programme. The bulk of that is really the debt swap programme. That is simply a book entry for Rs.33,785 crores. Then, on the Department of Posts, there was an excess expenditure of Rs.5 lakhs, for the Ministry of Defence, there was an excess expenditure of Rs.71 lakhs, and for the Department of Urban Development, there was an excess expenditure of Rs.26 lakhs. So, these are small amounts which have to be technically regularised by Parliament. That is why the excess grants have been moved.

Sir, as far as the Supplementary Demands are concerned, I have already explained that 94 per cent is really transfer of resources to the States under four heads. Not all of this could have been anticipated. For example, Sir, we have imported more fertilisers this year than was originally planned at the beginning of the year. The fertiliser prices have increased, and, therefore, we have to provide greater fertiliser subsidy. Another example is the package announced by the Prime Minister for the suicide-prone 31 districts. This could not have been anticipated on the 28th of February. When the Prime Minister of the country announces a package, it is my duty to provide funds so that these funds are released to the States. (Contd. by 4j-sss)


SHRI P. CHIDAMBARAM (CONTD.): The third is the subvention of two per cent. My friend may not have been quite informed. Yes, in the Budget I announced two per cent subvention for loans extended by commercial banks and RRBs. But then the States demanded that for even loans extended by the cooperative banks, the subvention should be drawn by the Central Government. I resisted it for a while. But, I said because it is your bank, you must provide the subvention. Some States, Andhra Pradesh, Karnataka, Tamil Nadu, Punjab, Orissa said that they would bear the subvention. But most other States, as is only to be expected, demanded that the Centre should bear the subvention. So we have decided three weeks ago that we will bear the subvention for that portion of the loan also. So money is being provided. This is not new. In fact, year after year, Supplementary Grants are sought from the Parliament and Supplementary Demands are voted by Parliament. This is not new and every year, in fact, there have been a first batch, a second batch and a third batch. I have got the figures right from 1998-99. In fact, in 1999-2000, the second batch of Supplementary Demands was about Rs. 6,178 crores, technical and cash of Rs. 7949 crores. This is not unusual. In a dynamic economy, in a dynamic democratic system, demands will arise during the course of the year and that is why we come back to Parliament for Supplementary Grants. Sir, there are only a few issues on which I think, I need answer. Firstly, the question of aam aadmi. Now, I think, we have tended to reduce the debate to one of partisanship and dialectics. Who is the aam aadmi? Aam aadmi is a student who wants educational loans. Aam aadmi is a lady who is a member of a self-help group. An aam aadmi is a farmer who wants farm loans. So when we say that we are doing things for the aam aadmi what we really need to look at is, are we addressing all these concerns of various sections of the people? I believe we are. Take for example, SHGs or SMEs. As on 31st March 2005, the total credit given to SMEs was Rs. 1,17,00,293 crores. As on 30th September, 2006, that is a period of 18 months, total outstanding loan to SME has increased to Rs. 1,61,133 crores. In a period of 18 months, we have advanced, net advance of about Rs. 44,000 crores. Take for example, agricultural loans. I have given this figure several times. In the last year of the NDA Government, total farm loans were Rs. 86,981 crores. I promised to double it in three years. Double Rs. 86,981 means Rs. 1,73,000 crores in three years. But, at the end of second year, we reached Rs. 1,67,775 crores and this year we will far exceed the target of Rs. 1,75,000 crores. The farmer is the aam aadmi and loan has been given to him. Take for example, number of SHGs. As on date, 23.72 lakh SHGs have been given credit by banks, total amount of Rs. 12,618 crores. Besides, through the Ministry of Rural Development Schemes another 23.89 lakh SHGs have been given Rs. 7498 crores. This number is increasing year after year after year. (Contd. by VP/4K)


SHRI P. CHIDAMBARAM (CONTD.): Similarly, there are education loans. When our Government came into office, the total outstanding education loan was about, slightly less than, Rs. 4,000/- crores. Today it is Rs. 12,000 crores. More education loans have been granted in the last two-and-a-half years than in any other period in India's history. Therefore, when we talk about aam admi, it is not talk in the air. We are talking about what we are doing to students, what we are doing to farmers, what we are doing to SHGs, what we are doing to SMEs and what we are doing to industry. And, I believe, we are redeeming our promise to every section of the people. Take for example, transfers to States. In the Budget, you would have seen that in 2005-06, States' share of taxes was Rs. 94,959/- crore. This year, we will transfer to the States as their share of taxes, Rs. 1,13,448/- crore. That we will do better because the revenue collection is better. Non-Plan grants and loans last year were Rs. 34,053/- crore. This year it will be Rs. 35,461/- crore. Therefore, more money given to the States means, States will have more money to spend on whatever programmes States think are best suited for their people. Where does that money go? It goes, I believe, to the aam admi, unless you tell me your State is not spending on aam admi. States are not deprived of funds. As on 8th December cash balances of States were Rs. 42,247/- crore. So, States should spend. If I raise more revenue, 30.5 per cent, automatically, goes to the State. For every rupee that I raise extra, 30.5 paise goes to the States. So, States must spend. As on 8th December, cash balances were Rs. 42,247 crore.

Sir, I am glad that everybody recognises that India is on a growth path. It is not a matter of partisanship. We went through a bad period between 2000-01 and 2002-03. For three years we had a bad patch. We are not getting into any argument about who was in Government then, or why was there a bad patch. It was a bad patch. In fact, in 2002-03, it was the lowest GDP growth rate in 20 years. It was 3.8 per cent. Next year, thanks to a low base, even normal growth turned out to be like 8.5 per cent. That is, partly, a statistical illusion. But let us take it for what it is. But, after 8.5 per cent growth, in the last three years, this country has achieved 7.5 per cent in 2004-05, 8.4 per cent in 2005-06, and in the first half of this year, 9.1 per cent. The question is: Are we all united in one goal that we should maintain this growth rate and increase this growth rate to ten per cent? It is not a question of which is the Government or who is the Finance Minister or who is the Prime Minister. As a nation we must aspire to be the fastest growing country in the world. Some people say we are the second fastest growing economy in the world. That does not make me happy because when I say ours is the second fastest growing economy in the world, I am, impliedly, conceding that there is another country which is growing fast. I want to be the fastest growing economy in the world. Why should we be the second best? I believe, Sir, that we can achieve ten per cent growth rate sometime during the next Plan period. I am not saying it will happen in the first year. But, sometime during the next Plan period we should aim to achieve ten percent growth rate and we must maintain that ten percent growth for about 5-10 years as China has done. Japan grew by 10 per cent for ten years. China is growing at ten per cent for the last 5 years. So, why can't India achieve ten per cent growth rate and maintain the growth rate for 5-10 years? I believe it is possible. Despite all our differences, despite political differences, despite ideological differences, on this one goal we must achieve high growth, we must be united, we must put all our hearts, all our minds, and all our strength behind this single goal. (Contd. by PK/4L)