Mamata's 'pegasus spin' jibe at 'directionless' budget, her economic advisor concurs

The Union budget proposals for 2022-23 presented by the finance minister, Nirmala Sitharaman on the floor of the Parliament on Tuesday has ignored demand stimulation and hence the budget is directionless, West Bengal chief minister, Mamata Banerjee, has said with Amit Mitra, her chief economic advisor echoing her views.

Kolkata:The Union budget proposals for 2022-23 presented by the finance minister, Nirmala Sitharaman on the floor of the Parliament on Tuesday has ignored demand stimulation and hence the budget is directionless, West Bengal chief minister, Mamata Banerjee, has said with Amit Mitra, her chief economic advisor echoing her views.

Soon after the budget proposals were laid, Mamata Banerjee, who is also the state finance minister, posted a Twitter message where she described the budget as “A Pegasus spin budget". “Budget has zero for common people, who are getting crushed by unemployment & inflation. Govt is lost in big words signifying nothing - A Pegasus spin budget,” she tweeted.

She said that the current proposals have satisfied only those who have benefited to the maximum during the pandemic period. According to her, the budget has nothing to offer to the common people who are reeling under the dual pressure of unemployment and inflation.

Speaking to media, Amit Mitra said that the budget was "directionless" since it does not speak of any demand-stipulating proposal. "Even countrieslike England and Germany are resorting to direct cash transfer to the people during this pandemic to continue with the demand-stimulation in the market. The British government is paying 80 per cent of the last drawn salary to those who have lost jobs during the pandemic period. The German government is paying for the rent of those people who stay in rented accommodation. In India, around 1.2 crore people have lost their jobs during the pandemic period. The budget proposals mention nothing about them. So the budget is directionless and full of bluffs,” Mitra said.

He also took a dig at the Union finance minister over her proposals to reduce corporate tax. “Last year also she reduced corporate tax, hoping that the money coming as a reserve because of tax reduction will be invested by the corporate houses. However, instead of investment, the corporate houses showed that reserve in their books of profit and hence they achieved record profits even during this pandemic period,” he said.

He also said that the Mamata Banerjee-led West Bengal government "showed the courage" of direct cash transfer to people even during this period of economic crisis. “Because of that direct cash transfer the demand somewhat prevailed in the market. Hence, even during the pandemic period West Bengal showed positive economic growth of 1.2 per cent, while the nation showed a negative economic growth of 7.7 per cent,” Mitra said.

He added that the only medium of revenue generation for the Union government is selling off public sector assets. “The economy of the country will never revive through this short-sighted approach. Already the Union government has started the process of privatizing the railways. Air India has already been sold off. The PPP model has also been introduced for six ports. Now the Union finance minister is speaking on divesting government stake in LIC India. These steps will never stimulate demand,” Mitra said.

In the budget proposal on Tuesday, the Union Finance Minister proposed a Rs 1,00,000 crore corpus for providing a 50-year interest-free loan to the state government so that the latter can invest in economic simulations. However, economist Santanu Bose said that a state like the West Bengal government will not benefit from this corpus.

"These interest-free loans can be utilized by the state governments only for asset-creating capital expenditure like funding of any expansion plans for any state public sector undertaking. These interest-free loans cannot be used for recurring expenditures like salaries or funding dole projects like Lokkhir Bandar. The West Bengal government hardly has any running state PSUs in healthy conditions. Some which are there are beyond the point of revival. So hardly this corpus will benefit the West Bengal government,” he said.