Former Finance Minister P Chidambaram's critique of the Union Budget - 2024 | Full Speech

Summary

The speaker addresses the Finance Minister, urging the government to adopt ideas from the Congress Manifesto for job creation and tackling unemployment, expressing skepticism about the effectiveness of the Employment Linked Incentive (ELI) scheme. They highlight the seriousness of inflation, criticizing the government's dismissal of the issue and questioning the RBI's stance on it. The speaker also emphasizes the need for relief for the bottom 50% of the population, the importance of addressing daily laborers' conditions, and criticizes the government's approach to federalism. They conclude with five demands, including a minimum wage, legal MSP, and the abolition of the Agnipath scheme.

Takeaways

• 📜 The speaker commends the Finance Minister for incorporating employment-linked incentive schemes and other ideas from the Congress Manifesto in her speech.
• 📚 The speaker encourages members of the treasury benches to read the Congress Manifesto for potential policy inspiration, humorously stating that copying is encouraged in the house.
• 🔍 The speaker expresses concern over the lack of clarity in the Employment Linked Incentive (ELI) scheme, questioning its effectiveness and the discrepancy in the number of industries targeted.
• 📉 The speaker highlights the issue of unemployment, citing high application numbers for few job vacancies as evidence of the severity of the problem.
• 💼 The speaker criticizes the RBI's statement that there is no jobs crisis in India, arguing that it contradicts the evident high demand for employment opportunities.
• 📈 The speaker discusses the issue of inflation, pointing out the difference between official statistics and the actual experienced rates in rural and less accessible areas.
• 💔 The speaker emphasizes that inflation is a serious issue affecting every family and criticizes the Finance Minister for dismissing it in a mere 10 words.
• 🤔 The speaker questions the government's economic growth figures, challenging the methodology used to calculate the GDP and the adoption of certain deflators.
• 💰 The speaker raises the issue of wages, pointing out that the majority of taxpayers have zero tax liability and questioning the relief provided to the bottom 50% of the population.
• 🏛 The speaker addresses the issue of federalism, criticizing the central government for selectively providing relief to certain states and undermining the autonomy of state governments.
• 📣 The speaker concludes with five demands, urging the Finance Minister to adopt these policies from the Congress Manifesto, and insists on receiving a response to these demands.

Q & A

What is the Employment Linked Incentive Scheme mentioned in the speech?

The Employment Linked Incentive Scheme is a policy initiative aimed at creating jobs, although the specific details and outcomes of this scheme are not clearly outlined in the script.

Why does the speaker urge the Finance Minister to read the Congress Manifesto?

The speaker believes that the Congress Manifesto contains good ideas, particularly on pages 11, 30, and 31, and hopes that adopting these ideas will lead to more effective policies.

What is the speaker's view on copying ideas from the Congress Manifesto?

The speaker encourages the idea of copying, stating that it is not prohibited and is even rewarded in the house, suggesting that borrowing good ideas can lead to better policies.

What is the estimated all India unemployment rate mentioned in the script?

The script mentions an estimated all India unemployment rate of 9.92% for June 2024, as per the Center for Monitoring Indian Economy.

What is the Production Linked Incentive scheme referred to in the script?

The Production Linked Incentive scheme is a previous initiative aimed at boosting production, but the speaker suggests it did not create the desired number of jobs, leading to the introduction of the Employment Linked Incentive scheme.

What is the speaker's opinion on the outcome of the Production Linked Incentive scheme?

The speaker is critical and suggests that the scheme did not meet its job creation goals, prompting the need for a new employment-linked incentive.

What is the significance of the figures mentioned regarding job applications and vacancies in various sectors?

The figures highlight the magnitude of unemployment in India, showing a stark contrast between the number of job vacancies and the large number of applicants for those positions.

What does the speaker imply about the RBI's statement on the jobs crisis in India?

The speaker criticizes the RBI's statement that there is no jobs crisis in India, implying that it is out of touch with the reality of high unemployment rates and the struggles faced by job seekers.

What are the speaker's views on the issue of inflation as discussed in the script?

The speaker is critical of the Finance Minister's dismissal of inflation as a trivial subject, arguing that it significantly impacts families and the economy, and that the government should take it more seriously.

What is the speaker's stance on the government's approach to federalism?

The speaker criticizes the government for perceived favoritism towards certain states, suggesting that this undermines the principles of federalism and equal treatment of all states.

What are the five demands made by the speaker in the script?

The five demands are: 1) A minimum wage of 400 rupees per day for all employment, 2) A legally guaranteed Minimum Support Price (MSP) for farmers, 3) Write-off of unpaid interest or installments of educational loans up to March 2024, 4) Abolition of the Agnipath scheme, and 5) Scrapping of the Meat Act, with exceptions for states that wish to keep it.

Outlines

00:00

📜 Manifesto Inspiration and Employment Concerns

The speaker begins by expressing gratitude to the Finance Minister for her initiatives and encourages the treasury benches to consider ideas from the Congress Manifesto, particularly those related to employment. The speaker highlights the unemployment rate as a significant issue, referencing the center for monitoring the Indian economy's estimations and the need for a more effective employment-linked incentive scheme. The speaker also criticizes the lack of clarity and confidence in the proposed scheme, suggesting it may not meet its ambitious targets.

05:01

📊 Unemployment and Inflation: A Growing Concern

The speaker discusses various instances of high demand for limited job vacancies, indicating a severe unemployment problem in India. They also address the issue of inflation, criticizing the Finance Minister for dismissing it too casually. The speaker emphasizes the discrepancy between official inflation rates and the actual experienced rates in rural areas, and questions the RBI's stance on the absence of a jobs crisis, suggesting a disconnect between government reports and the lived reality of the people.

10:02

💼 Economic Growth and Wages: Questioning the Statistics

The speaker questions the government's reported economic growth rates, challenging the methodology used to calculate real GDP growth. They express skepticism about the deflator used for different sectors and its impact on the reported growth figures. The speaker also raises concerns about wage levels, particularly for the bottom 50% of the population, and the government's apparent lack of attention to the struggles of daily laborers and those in irregular employment.

15:04

🏛️ Federalism and State Inequality

The speaker criticizes the central government's approach to federalism, citing instances of funds being withheld from certain states and the perceived political bias in the treatment of state governments. They argue that the union government should not selectively favor or neglect states based on political affiliations and that this undermines the principles of federalism.

20:07

📚 Education and Poverty Alleviation: Unmet Needs

The speaker discusses the issue of unpaid educational loans and the need for their write-off, as well as the broader issue of poverty in India. They challenge the government's claim of having virtually abolished poverty, pointing to the high ranking in the world hunger index and the government's own actions to provide free food grain to a large portion of the population as evidence of ongoing struggles with poverty and hunger.

25:08

🗣️ Five Demands for the Finance Minister

In conclusion, the speaker presents five demands for the Finance Minister to consider, which include a minimum wage for all employment, a legally guaranteed minimum support price for agricultural products, a write-off of unpaid educational loans, the abolition of the Agnipath scheme, and the scrapping of the Meat Act. The speaker insists on a response to these demands and asserts that they will resonate throughout the country.

Keywords

💡Employment Linked Incentive Scheme

The Employment Linked Incentive Scheme (ELIS) is a proposed initiative aimed at creating jobs and incentivizing employment. In the script, it is mentioned as a new scheme introduced by the government, which the speaker suggests may not be as effective as the previously introduced Production Linked Incentive scheme. The speaker urges the Finance Minister to consider ideas from the Congress Manifesto for improving job creation.

💡Unemployment Rate

The unemployment rate is a key economic indicator that measures the percentage of the labor force that is without jobs and actively seeking work. In the script, the speaker cites the high unemployment rate in India, as estimated by the Center for Monitoring Indian Economy, to highlight the severity of the job crisis in the country.

💡Inflation

Inflation refers to the rate at which the general level of prices for goods and services is rising, and subsequently, the purchasing power of currency is falling. The speaker criticizes the Finance Minister for dismissing the issue of inflation too casually in the speech, emphasizing that high inflation rates significantly impact the cost of living for the population.

💡Growth Rate

The growth rate is the speed at which an economy is growing, often measured by the percentage increase in Gross Domestic Product (GDP). The speaker questions the government's claim of high growth rates, suggesting that the reported figures may not reflect the actual economic conditions or the experiences of the people.

💡Deflator

A deflator is a statistical tool used to adjust economic figures, such as GDP, to remove the effects of inflation. In the script, the speaker challenges the government's use of a specific deflator to calculate the growth rate, implying that the choice of deflator may have led to an overestimation of the actual economic growth.

💡Wages

Wages refer to the compensation or remuneration paid to employees for the work they perform. The speaker discusses the issue of wages, particularly the relief given to taxpayers, and questions the extent of this relief in the context of the broader population, highlighting the income disparities and the living conditions of the lower-income groups.

💡Federalism

Federalism is a political system in which power is divided between a central authority and constituent political units, such as states. The speaker criticizes the government for undermining federalism by selectively providing relief and support to certain states, suggesting a lack of equitable treatment across all states.

💡Manifesto

A manifesto is a public declaration of the intentions, motives, or views of an individual, organization, or political party. The speaker refers to the Congress Manifesto, which outlines the party's policies and proposals, and encourages the government to adopt some of the ideas presented in it.

💡Agnipath Scheme

The Agnipath Scheme is a proposed policy related to the military, which the speaker demands to be abolished. The specific details of the scheme are not elaborated in the script, but the speaker's opposition to it suggests concerns about its implications for the armed forces or society.

💡Legally Guaranteed MSP

MSP stands for Minimum Support Price, which is the minimum price that a government guarantees to pay producers for a commodity. The speaker demands a legally guaranteed MSP for farmers, indicating a concern for ensuring fair prices and income stability for agricultural producers.

💡Educational Loans

Educational loans are financial aids provided to students to pursue higher education. The speaker calls for a write-off of unpaid balances or installments of educational loans, suggesting a recognition of the financial burden that such debts impose on students and their families.

Highlights

The speaker urges the Finance Minister to take ideas from the Congress Manifesto, stating copying is encouraged and rewarded in the house.

Unemployment is identified as the biggest challenge, with the all India unemployment rate estimated at 9.9% in June 2024.

The Employment Linked Incentive (ELI) scheme is questioned for its effectiveness in job creation compared to the Production Linked Incentive (PLI) scheme.

The speaker expresses lack of confidence in the ELI scheme's ability to employ 29.20 lakh people, likening it to unfulfilled election promises.

Examples of high competition for low-skilled jobs illustrate the magnitude of the unemployment problem in India.

The speaker criticizes the RBI's statement claiming no jobs crisis in India, arguing it contradicts the ground reality.

Inflation is highlighted as a serious issue, with the speaker pointing out the disparity between official rates and actual experienced rates.

The Finance Minister's dismissal of inflation as a trivial subject in just 10 words is criticized.

The speaker questions the RBI's 6.5% bank rate, suggesting it does not align with the stated inflation target.

Growth rate calculations are challenged, questioning the use of deflators and their impact on reported GDP growth.

The speaker emphasizes that the reported growth rates are not felt by the people, citing personal observations from extensive travel.

Wages and relief measures are scrutinized, with the speaker arguing that the benefits do not reach the majority of the population.

The condition of daily laborers and the irregularity of jobs are highlighted as serious concerns.

India's ranking in the World Hunger Index is mentioned to underscore the need for better food affordability and accessibility.

Federalism is discussed as a critical issue, with examples of central government interference in state matters.

The speaker criticizes the selective treatment of states, arguing it undermines the principles of a federal country.

The omission of certain states from the Finance Minister's speech is pointed out as a sign of neglect.

Five demands are put forth by the speaker for the Finance Minister to address, including minimum wage, MSP, loan waivers, and the abolition of certain schemes.

Transcripts

[Applause]

[Music]

Mr

chairman I want to thank the honorable

Finance Minister one please hear him

patiently for the employment linked

incentive

scheme and other

ideas Incorporated in the early part of

her

speech I'm particularly

happy that she had an opportunity to

read the Congress Manifesto

yes and she picks the good ideas on page

11 page 30 and Page

31 I would respectfully urge my

honorable friends in the treasury

benches

to read the Congress Manifesto so that

in your party especially the external

affairs minister in your party meetings

you can persuade The Honorable prime

minister and The Honorable finance

minister to take some more ideas from

our Manifesto we'll be very very

happy uh to support you if you take

those ideas

copying is not prohibited in this

house in fact copying is encouraged

copying is rewarded in this one second

one second if you'll address the chair

it will give a soothing feeling to me

also and that will be more appropriate

mrra copying is encouraged and copying

is rewarded in this house so please copy

a little

more sir I have four major themes and I

think I should be able to complete my

submissions on each theme in about four

or five minutes the first is

jobs unemployment is the biggest

challenge the center for monitoring

Indian economy has

estimated all India unemployment rate in

June

20

24 as

99.2% it may have come

down

now earlier there was a production

linked

incentive when you introduce the

employment linked incentive it must be

for some

reason and I suspect the reason was that

the production linked incentive scheme

did not create the kind of jobs that you

wanted to

create so will The Honorable Finance

Minister tell this house what is the

outcome of the

P once we know the outcome of the

P we can look ahead to what can be

expected of the

Eli in fact from

paragraphs

2021 and 22

read with paragraph 51 of her

speech neither I nor any of my learned

colleagues are able to get a whole

picture of the

Eli it seems to us that paragraph 20

talks about the same Target Industries

like paragraph 21 and paragraph 21 talks

about the same Target Industries as

paragraph 22 but in paragraph 51 we

sudden ly let down when you said only

500 Industries are

selected the numbers don't gel the

numbers don't match anyway you have a

Eli it's an interesting idea but it does

not Inspire confidence and let me go on

record to say it does not Inspire

confidence that you will be able to

place 29 20 lakh people under the Eli

that you have

described it should not turn out to be

another election jumla like your two CR

jobs in

[Music]

yes now look at

the magnitude of the unemployment

problem utar Pradesh Police Department

conducted an examination for

6,244 vacancies

48 lakh persons applied and wrote that

examination it was cancelled a couple of

days

later Air India wanted to fill

2,216 vacancies of handyman to do

diverse jobs like repair and maintenance

25,000 people thronged Mumbai airport

for a Walkin interview and the police

had been called to restore law or

not a private company in Gujarat sought

to fill five positions 1,000 persons

barged into that

company Madia Pradesh advertise

155 low skilled government jobs

11,000 applications were received among

them were postgraduates engineers

mbas and I'm sad to say

even one of them who had just written an

examination to be a judge in the m in

the madhya Pradesh

I the best illustration is by the staff

selection commission there are staff

selection commissions of the center and

the

states utar Pradesh conducted an

examination for 7,500 posts 24 lakh

7430 people applied for those job jobs

and yet the RBI about 2 3 weeks ago said

there is no jobs crisis in

India exact words no jobs crisis in

India why didn't anyone from the

minister or any officer stand up and say

we reject this statement RBI is supposed

to be cautious conservative and

neutral but you're cautious you're

conservative and you're not neutral at

all

yes I suggest sir that unemployment be

taken seriously and we will wait for the

outcome of your Eli scheme it is an

interesting scheme at the moment I'm not

impressed I'm not convinced the outcome

alone will judge whether your intentions

are good whether you really want to

tackle

unemployment sir the second broad

subject is inflation

The Honorable Finance Minister in

paragraph three of her speech dismissed

the subject in 10

words and I'm not exaggerating please go

through the speech exactly 10

words is inflation such a trivial

subject you can deal with it casually

and dismiss it in 10

words WPI infl

is

3.4% CPI inflation is

5.1% food inflation is

99.4% Shame Shame this is data collected

where you can collect data mostly along

towns and Villages AB butting the

national highway at best the state

highway at best District highway but go

into the hinterland of India

do go into the kbk districts of odisha

go into the Interiors of darapuri or

ramapura the inflation is much higher

than

your 3.4% or 5.1% or

99.4%

and the chief economic

advisor who may be cautious conservative

he has a degree of autonomy which no

other officer of the government of India

has he said in his economic survey quote

India's

inflation continues to be low stable and

moving towards the 4%

Target it's been moving for the last 4

years when will it arrive at a 4% Target

is inflation

low is it

stable is it moving towards the 4%

Target if it is moving towards the 4%

Target why has the RBI not revised

downward the bank rate fixed in June

2023 yes this is the 13th month of a

6.5% bank rate bank rate is the good

measure of where inflation is moving if

inflation is moving towards the

4% Target 4% is the target is actually

two plus or 4 plus or minus 2 it's not

4% assuming that 4% is the target why is

the RBI keeping the bank rate at 6.5%

for the last 13 months why is the MPC

the monetary policy committee not

willing to revise it

downwards and I think what the chief

economic advisor said in his economic

survey is

injury and The Honorable Finance

Minister dismissing the subject in 10

words is adding insult to

injury

inflation is a humiliating situation

because every family is hit by inflation

I warn this

government you are taking

inflation not so

seriously the last set of byelections

punished you you will not agree but I

think the last set of byelections where

out of 13 seats 10 seats were won by the

India block is a punishment a warning

administered to you and if you don't

take inflation seriously you will be

punished more if you want to suffer the

punishment you're welcome to suffer the

punishment and in this

situation you claim that the growth was

last year

88.2% and this year it will be 6.5% to

7% I'm not going into the macroeconomic

analysis

some of my colleagues will do that I ask

you how do you arrive at this growth

rate you take the nominal growth rate

and apply a deflator and arrive at the

GDP

sir the house and you must know that the

deflator that they have adopted for the

manufacturing sector for last year is

1.7 when wholesale inflation is 3.4

when CPI inflation is

5.1 food inflation is 9.4 how do you

adopt a deflator of

1.7 in fact I want The Honorable finance

minister to tell us what is the deflator

you have adopted for manufacturing

industry what is the deflator you have

Manu you have adopted for industry and

uh for for agriculture and what is the

deflator you've adopted for services

nominal growth growth is measurable but

your GDP in real terms is simply by

appointing by adopting a deflator and if

you adopt a

deflator which several

knowledgeable economists and experts

throughout the world have severely

criticized for the last three or four

years you will arrive at these Rosy this

Rosy

picture you were adopted deflator less

than

1.7 you would not have have arrived at

8.2 you would have arrived at

9.2 you you you adopt a deflator of .5

you you you will even cross 10% so

please tell us what is the deflators

you're adopting why are you adopting and

what tell us what is the nominal growth

rate and how do you arrive at these

growth rates these growth rates are not

cannot be seen but these growth rates

can be felt by the people please uh uh

anyone U moving around the people will

know the growth rate can be felt by the

people when there is uh impressive

growth when there is more goods and

services when prices are affordable when

there is money uh floating around in the

market when your pockets are jingling

with coins or currency nodes you get the

you get the feeling that things are

going all right in this country do you

get the feeling I travel I travel at

least 500,000 Kil kilometers every month

by road I don't get that feeling does

any honorable member from his

constituents your state get the feeling

that the people tell him things are very

good things are very good please go and

tell the prime minister in Delhi things

are very good you're very

happy does any anyone get that feeling

no

sir the third subject is

Wages now this is a serious

matter The Honorable Finance Minister

said I have given relief who is she

given relief to I don't Grudge the

relief she has given relief but

who in

2223 the last I was able to access the

number of

taxpayers is 7.4

CR it may have increased to8 or 8 and 8

and half

CR out of

that 65% have zero tax

liability they file a return but no

tax assuming that the

60% remains

constant of say 8 CR or 9 CR taxpayers

today 5 and a half to 6 CR will be zero

tax

liability you have given relief to

people who move to the new tax

regime the new tax regime I've seen

various calculations each paper has got

a calculation I have a chartered

accountant who's given me a calculation

from Gujarat and he is very

knowledgeable he said says that the

relief given is

between

9,651 Rupees to

17,50 rupes to whom to this 2 to three

CR

people India is does not consist only of

these 2 to three CR people there are 142

CR in this country out of 142 CR let's

assume you have given relief to 2 to

three CR people what about the rest do

you know the conditions of the rest your

household consumption expenditure survey

of the government of

India counted that the bottom

50% the the bottom

50% have 3% of the national wealth 133%

of the national

income

and the monthly

consumption monthly consumption in rural

areas of the family is

3,094 rupees multiplied by 12 you will

arrive at about 37,000 rupes a

year in urban areas it's

4,963 rupees multiplied by 12 you get

60,000 Rupees so we have 50% of the

population monthly consumption

expenditure

50% is 71 CR have a monthly consumption

expenditure of

between 36,000 Rupees to 50,000 Rupees

are they rich or poor this is the bottom

50 below the medium you go down to the

bottom 20 go down to the bottom 10 they

are even

poorter what is the relief for them

and the Niti

AOG Chief uh Chief uh Executive Officer

says India's virtually abolish poverty

poverty cannot be more than

5% poverty cannot be more than 5% when

you're talking about 71 CR people 71 CR

people thankfully is not 5% then India's

population will be 1,400

CR India's population is 14 2 CR 1/2 is

71 they are below the 1 71 CR they are

below the median and this is the median

income sir I asked the honorable Finance

Minister what is the relief given to

them do you know

that most of them are daily labor 30 CR

daily labor in this

country the others are irregular reg

jobs the regular jobs regular jobs are

only for about 17 to 25% of this country

all the rest are in irregular jobs or in

Daily labor what is the relief given to

them in the world hunger index of 125

countries we are

111 you may not accept the world hunger

index but the action that the government

has taken namely giving free food grain

to 81 CR people is a tcid admission that

on the hunger index we have very very

low forget the hunger index 81 CR people

your own action shows that people cannot

afford

food

so my last subject is

federalism what do we see around this

country

all India service

officers

defy the directions and

Orders of the Council of Ministers of an

elected government in

Delhi funds are withheld from Kerala and

West Bengal on one pretext or

other borrowing limits borrowing limits

of non-bjp States governments have been

slashed

Sam Nadu has been denied disaster relief

assistance I ask why does the

upsc have to play a role in the

appointment of the DGP of the

state why should a state government not

appoint the vice Chancellor of state

[Music]

universities and how did this government

treat Andra Pradesh

and

bear and odisha before

April the same demand is there the same

Andra Pradesh reorganization Act is

there it was there the chief minister

was a different person the same act for

10 years how did you treat them how for

for 10 years how did you treat

bear when a leader wears one cap you

treat him one way when he changes that

cap and he wears another cap you treat

him another

way I have no I don't Grudge at all

you're giving relief to Andra Pradesh or

Bihar but what

about the other states we are a federal

country this is the death Nell of

federalism if you pick and choose among

states

you are the union of India you are the

union government you are the government

of all the states you cannot pick and

choose one state and deny relief to

another

[Music]

state sir

finally I thought the honorable Finance

Minister loved TR I missed uh her quotes

from either Tru or any other classic

literature

uh maybe she didn't have time to quote

from a classic poet in Telugu or in

bojpuri uh maybe she will in course of

time I want her to remember that she was

born in

madur she had a schooling in

vuram and she had a college in

Tali and it is very painful as the chief

minister of Tamil Nadu pointed out that

not in one place in Her 60-page speech

did she mention the word Tamil Nadu or

Tamil I'm not saying mention only Tamil

Nadu mention all states of mention all

the states grouped together how many

times have you mentioned Bihar how many

times have you mentioned Andra

Pradesh I have no grudge but please

remember that there are other states in

India other states of people other

States elect

other States elect other governments

they vote against you please remember

that finally sir I have one minute I

have five

demands five demands which I would urge

The Honorable finance minister to copy

from our

Manifesto I demand this and I want

answers respectfully I ask the honorable

minister to give us answers if you don't

answer this today or in the course of

the session or subsequently it is not as

though these demands will die down they

will Echo everywhere in India where the

India block has a right to speak and

right first

demand we demand that a minimum wage of

400 rupees per day for every kind of

employment two we demand a legally

guaranteed

MSP three we demand a write off of the

unpaid balance of Interest or

installment of educational loans given

up to March

2024 four we demand the abolition

complete abolition of the agnipath AG

scheme and five we demand that meat be

scrapped and if you if some states want

to keep meat except all other states

which don't want meat these five demands

will Echo not only in this chamber it

will Echo throughout the country until

you conceive these demands I demand that

The Honorable Finance Minister reply to

my demand that he should reply to this

issu thank you very good

[Music]