The Indian National Congress, the principal Opposition party, has said it was time the government started taking steps to improve the investment climate and focus on job creation, while the Left parties have demanded an increase in public expenditure.
The Congress party maintained that a conducive climate for investment is a necessary minimum for reviving infrastructure development.
Senior Congress leader M Veerappa Moily, who heads the Parliamentary Standing Committee on Finance, said the Narendra Modi government has so far been “all talk” and “no work”.
“Credit growth is still dismal. Where is the question of investment? So far, they have not been able to improve the situation at all,” Moily said, adding that the economic fundamentals continue to be strong. He added that the BJP government missed the bus despite having favourable crude oil prices since July.
Moily also said that the government should not prune social sector spending.
“This government has been neglecting all the flagship social welfare programmes of the UPA government. There is a severe fund crunch and low employment generation under the MGNREGA scheme. The government’s focus should be on creation of job opportunities. It will push up the rural economy. Never before has the government delayed release of the Member of Parliament discretionary fund. It has not yet released the funds for MPLAD Scheme,” said Moily.
The Congress is also keen that the government makes headway in ending the logjam over the goods and services tax.
“GST should have top of the Government’s priority list. The Prime Minister should have spoken to the chief ministers. He had met chief ministers twice so far. In fact, the GST should have been the first item to be discussed at the NITI Aayog meeting,” he said.
Echoing views similar to that of the Congress party, Brinda Karat of the Communist Party of India (Marxist) said that cuts in social sector spending are absolutely unacceptable.
“For employment generation, it is essential the government increases expenditure instead of showing its absolute fiscal fundamentalist obsession and the obsession to control the deficit. What the economy needs is a big boost through public expenditure in important areas. In the social sector, it is essential to increase the allocation for MGNREGA, which is a demand driven scheme. By not doing so, the government is hitting the economy,” she said.
The CPM also wanted cuts in excise and custom duties as well as in other indirect taxes.
“Tax revenue needs to be generated from big profit making companies. Essentially, we want a shift in revenue mobilisation to more direct taxes. As for the issue of black money, the government should show its seriousness about bringing it back by including it as part of its revenue mobilisation,” she said.