Budget may hurt poor: Chelliah

CHENNAI, June 6: The Chairman of Madras School of Economics, Dr Raja J Chelliah today alleged that the Swadeshi' pitch raised by union fina...

CHENNAI, June 6: The Chairman of Madras School of Economics, Dr Raja J Chelliah today alleged that the Swadeshi8217; pitch raised by union finance minister, Yashwant Sinha would gladden the hearts of influential classes at cost of the poor.

Speaking at a day-long workshop on Central budget and finance bill 1998-998242; jointly organised by the Madras Chamber of Commerce and Industry, Madras Management Association and Institute for Finance Management and Research, he said the special revival and growth package for the small-scale sector would also lead to inspector raj8217; and open up loopholes for lobbying.

Opining that the 1998-99 Union budget was conceptionally and ethically wrong8217; and drawn up to protect a certain section of the people, he said internal liberation without external protection would not benefit the industry in the long run. The country would not grow unless exports grew, Chelliah pointed out. 8220;Tax reforms are being introduced in the country ahead of its time,8221; Chelliah said and added 8220;thequestion is whether the Vajpayee government will be able to carry on with them given the composition of Parliament.8221; Referring to gift tax, he mooted a uniform policy to differentiate between inheritance and gifts. Chelliah said the budget proposals which included levy of many indirect taxes since 1992 would result in rise in prices but not necessarily inflation.

The Congress party8217;s economic affairs department secretary, Jairam Ramesh, said the budget has completely ignored the nuclear explosions at Pokhran and has no provision to meet the impact of economic sanctions.

Stating that about 2 billion of World Bank aid and another 7 million from the Asian Development Bank had been put on hold following the explosions, he said this had created uncertainty about the future of projects relying on funding from these institutions.

Claiming that the budget, allegedly dictated by industrial lobbyists and not by economists,was a setback to developmental activities, Ramesh alleged that it would give officialscomplete power and lead to corruption. He added that the power plans envisaged increasing the allocations and would be funded by extra budgetary finances and, not the capital market.