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On the money

In his Finance Bill speech,Yashwant Sinha offers a responsible critique. Govt must listen to him

Written by The Indian Express |
May 9, 2012 3:28:46 am

In his Finance Bill speech,Yashwant Sinha offers a responsible critique. Govt must listen to him

Initiating the Lok Sabha debate over the Finance Bill,Yashwant Sinha,senior BJP leader and chairman of the parliamentary standing committee on finance,was unsparing in his assessment of the government’s fiscal mismanagement,and yet stayed away from partisan opposition. He began with a jocular reference to Finance Minister Pranab Mukherjee’s possible elevation to “the big house”,Rashtrapati Bhavan,softening the mood. Sinha’s speech was remarkable both for its content and tone because it signalled his,and hopefully his party’s,commitment to a shared purpose — unlike the standard attack lines blaming the government for everything,or the language of crisis and conspiracy that opposition parties often evoke.

While acknowledging Parliament’s right to pass legislation which will have retrospective effect,Sinha pointed out that this must be exercised with great caution. He expressed his appreciation for the finance minister’s decision to roll back or postpone many of the divisive budget proposals,including the General Anti-Avoidance Rules (GAAR). He attacked the UPA for its fiscal indiscipline,unsustainable current account deficit and failure to provide a predictable climate for foreign investment. He questioned the need for budget secrecy,arguing for greater debate prior to parliamentary consideration. The government would do well to heed these points. As head of the committee deliberating the Direct Taxes Code,Sinha had argued for a careful introduction of GAAR within the new regime. He is steering many other important pieces of financial legislation,from the GST to the Companies Bill,banking and insurance amendments — all reforms on which the government and the largest opposition party have common instincts.

The UPA should take Sinha’s suggestions seriously,instead of stumbling ahead on its own and then having to roll back reforms when other parties refuse to cooperate. The BJP has expressed its willingness to cooperate on pending financial bills. It is up to the government now to smooth the tangles.

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