Budget is contractionary, won't address unemployment, inflation: Left parties

NEW DELHI: Left parties on Tuesday said the Union Budget is contractionary, does not address issues like inflation and unemployment and is trying to "mask the failures" of the government.

Reacting to Modi 3.0 government's first budget presented by Finance Minister Nirmala Sitharaman, the CPI(M) noted that there was no proposal of wealth or inheritance tax or any relief on the indirect tax burden on people and alleged that it will further impoverish the poor while the affluent will become richer.

"The budget presented today is a contractionary budget. What the people required on the contrary is an expansionary budget.

"We have one of the highest rates of unemployment, highest rates of food inflation, there is a growing level of restlessness and poverty, and unless the economy expands, none of these issues have been addressed," CPI(M) General Secretary Sitaram Yechury said in a video statement released by the party.

The net result of this entire thing is this budget "fails to address either inflation, unemployment, inequalities, and at the same time the slowing down of private investments in our country because the market is depressed", he said.

In a statement, the Politburo of the CPI(M) said the budget figures show that the revenue earnings of the government increased by 14.5 per cent while the expenditures grew only by 5.94 per cent.

"Instead of using these revenues for expanding economic activity, it has been used to reduce the fiscal deficit, to appease International Finance Capital from 5.8 per cent to 4.9 per cent of the GDP," the CPI(M) said.

"Overall, this budget is aimed at further enriching the rich and impoverishing the poor. It refused to consider any proposal of wealth or inheritance tax on the super-rich of India, neither any relief on the indirect tax burden on people," the CPI(M) said.

They said the GDP calculations projected in the budget are yet another exercise in "data fudging".

"Nominal GDP growth is projected at 10.5 per cent. Real GDP projected to grow 6.5 to 7 per cent is calculated by deflating the nominal growth by the 'core' inflation rate of 3 per cent which excludes the high food inflation rate of 9.4 per cent, thus exaggerating real GDP growth," CPI(M) said.

It also said fertilizer subsidy being cut by Rs. 24,894 core and food subsidy by Rs. 7,082 crore, expenditures on education, health and rural development as a percentage of GDP remain more or less unchanged, and flagship rural employment scheme MGNREGS continues to be neglected further.

"Budgetary allocation is Rs. 86,000 crores which was less than what was spent in FY'23. However, Rs. 41,500 crores are already spent in the first four months of this Financial Year, leaving a mere Rs. 44,500 crores for the remaining eight months.

"Clearly, this will be grossly inadequate to tackle the deep unemployment crisis in rural India," the CPI(M) said.

It said the budget resorted to "gimmickry" in the name of addressing unemployment with the new Employment Linked Incentive scheme.

"The Polit Bureau of the CPI(M) calls upon all party units to protest against the failure of the budget to address the pressing issues of the people and the economy," they added.

Communist Party of India General Secretary D Raja slammed the budget as a "deceitful exercise in hiding failures" of the last 10 years of the Bharatiya Janata Party (BJP) rule.

"BJP’s pro-corporate policymaking and torturous decisions have resulted in widespread miseries for the common people and the government is trying to shamelessly mask its failures on external developments in a period where crude oil prices have remained favourable than before," Raja said on X.

He said the budget shows the BJP is uncertain of the survival of the NDA government, and is trying to placate allies, adding that while his party has no issues with Bihar or Andhra Pradesh getting allocations, states like Kerala, Tamil Nadu and Odisha have been ignored.

"The Budget also shows that the BJP is uncertain about the survival of the NDA Government and trying to placate its allies from Bihar and Andhra Pradesh to continue in power," he said.

States should be equal in the eyes of the Union with objective criteria for allocation of funds, the way it was with the Planning Commission, he said.

Raja alleged that the budget has made it clear that the government only "makes noise" on the issues of youths, women, the poor and farmers while furthering corporate interest exclusively.