Chidambaram said the fiscal situation is in a mess. "The revenue deficit (7.5 per cent ) and the fiscal deficit (9.5 per cent) in the current year have exceeded every prediction, including the government's. In 2021-22, the government estimates it will borrow about Rs 3.42 lakh crore less, but nobody is willing to believe the government."
Chidambaram said the 'borrowing' number has been under-stated by assuming that there will be disinvestment revenues of Rs 1.75 lakh crore. "The record of this government on disinvestment is poor. The government has also assumed that tax revenues will increase by 15 per cent � another questionable assumption."
In the farm sector the former FM alleged that it has has been shortchanged as the budget allocation form 'Agriculture and Allied Activities' has been reduced from Rs 1,54,775 crore (BE) to Rs 1,48,301 crore (BE) and the MSMEs were dismissed in one sentence: an allocation of Rs 15,700 crore. Nothing was mentioned about providing liberal, low-interest loans, working capital or moratorium. Nothing will be done to revive closed units or to recover the millions of jobs that were lost.
"The FM seems to be unaware that thousands of MSMEs -- especially micro and small units -- have been closed permanently," Chidambaram said.
"A meagre sum of Rs 20,000 crore has been set apart for recapitalisation of public sector Banks, when the requirement is several times more. At the same time, the government intends to privatise two PSBs. The intent of the government is clear: let the PSBs bleed slowly so that they can all be privatized in the short term. Let us see the reaction of the public to this unconcealed desire to sell-off all public sector banks," he added.
Referring to tax reliefs, Chidambaram said the tweaking of provisions of the tax laws completely by-passed the tax-paying working class and middle class.
"Each one of the measures announced will benefit only the tax payers among the richer classes," he said.
Chidambaram said as expected the FM has paid special attention to election-bound states. She announced large capital outlays for Kerala, Tamil Nadu, West Bengal and Assam.
"But People are not fools, they know that the proposals are only outlays and the actual expenditure will happen only after the schemes are approved and over a period of several years depending upon the pace of implementation," he said.
