1. NDA’s stubborn attitude responsible for GST delay: P. Chidambaram

NDA’s stubborn attitude responsible for GST delay: P. Chidambaram

Blaming NDA's 'stubborn and unbending' attitude for the GST logjam, Congress today said the ball was in the government's court even as it targeted the ruling dispensation...

By: | New Delhi | Updated: January 2, 2016 2:42 PM
p chidambaram on salman rushdie book ban

P Chidambaram said the government has not been able to find a way to accommodate the views of the Opposition and pass the GST Bill. (Reuters)

Blaming NDA’s ‘stubborn and unbending’ attitude for the Goods and Service Tax (GST) logjam, Congress today said the ball was in the government’s court even as it targeted the ruling dispensation over the handling of economy, which the party claimed was “stuck in a groove”.

Former Finance Minister P Chidambaram said 2015 has ended on a “somber and subdued note” and many promises of the government — more jobs, greater investment and quicker infrastructure development — have not materialised

“…The economy is stuck in a groove,” he said.

Addressing a press conference at the AICC, the senior Congress leader said Prime Minister Narendra Modi had invited Congress President and former Prime Minister Manmohan Singh to a meeting, where they gave their three precise objections on the GST bill.

“What did the Prime Minister say … we will come back to you after reflecting within the government. That’s almost a month now. We have not received the written response of the government or the revised formulation of the government on the three principal objections”.

He said the ball is entirely in the government’s court and it is for them to come back and “tell us whether they accepting our objection (on GST bill), whether they are revising formulation, whether they are amending sections”.

The former Union Minister further said the government has not been able to find a way to accommodate the views of the Opposition and pass the GST Bill.

“I am afraid the government has only to blame itself and its stubborn and unbending attitude,” he said.

Chidambaram also said that “two of the three objections” have been virtually endorsed by Chief Economic Advisor Arvind Subramanian.

The Congress wants a constitutional cap on GST rate, withdrawal of one per cent tax on inter-state movement of goods and Supreme Court judge headed dispute resolution panel.

He further said that after the Bihar elections, there were initial signs that the government would reach out to the Opposition and adopt a consensual approach.

That hope was short-lived and as a result, many important legislation remain stalled in Parliament, he said.

The Constitution amendment bill for introduction of Goods and Services Tax (GST), touted as a major economic reform, has been passed by the Lok Sabha, but is stuck in Rajya Sabha where the ruling NDA does not have majority of its own.

Citing the example of the GST legislation, Chidambaram said the Congress and some other parties had objected to some provisions of the Bill on weighty and well-reasoned grounds.

The government was outright dismissive, until the Chief Economic Adviser virtually endorsed two of the three principal objections and made no recommendation on the third, he said.

Referring to the state of the economy, the former Finance Minister said for the whole of 2015-16, GDP growth is not likely to be higher than 7 to 7.3 per cent, which means that it will be the same as, or lower than, in 2014-15.

Chidambaram said the the mid-year economic analysis of has candidly admitted that private investment and exports — two of the four drivers of demand – are languishing.

“The Indian economy is like a car running on two wheels. Corporate balance sheets are stressed, net sales have fallen by 5.3 per cent, and profit after tax is flat. Non-food credit growth at 8.3 per cent is the slowest in 20 years. Growth of credit to industry is 4.6 per cent while credit to medium enterprises has actually shrunk by 9.1 per cent,” he said.

The government, he said, does not seem confident of meeting the fiscal deficit target of 3.9 per cent for the current financial year.

For 2016-17, Chidambaram said the government seems to be toying with the idea of departing from the path of fiscal consolidation — already delayed by a year.

“These are ominous signals, and I would like to caution the government against following an ill-advised policy,” he added.

The senior Congress leader further said the fiscal consolidation programme has been delayed by one year and “further delay would not be taken kindly by the world”.

Chidambaram, however, said he was not yet prepared to say there has been a fiscal mismanagement.

“…but reading the mid-year economic analysis, there are pointers to serious mistakes in fiscal management,” he added.

At the beginning of 2015, he said the government had confidently predicted that the economy will grow at 8.1 to 8.5 per cent in 2015-16.

“Many promises of the government — more jobs, greater investment and quicker infrastructure development — were premised on a high growth of GDP. I am afraid none of the promises has materialised. On the contrary, 2015 has ended on a somber and subdued note,” Chidambaram said.

He said there was acute distress in rural India, especially in the farm sector and urban India was not much better.

“Just travel through rural India and talk to people in the villages. There is deep resentment about the tardy implementation of MGNREGA, the cut in the average number of days of work and the delayed payment of wages. Crop insurance is unavailable to most farmers,” he said.

Chidambaram said education loans have “practically stopped”, and the demand for security has discouraged many students and parents from applying for loans.

“People are unable to point to any central government scheme that is being vigorously implemented. Panchayats are starved of funds. The anger and angst of rural India was reflected in the recent elections,” he said.

The 26th quarterly employment survey conducted between April and June 2015 showed that job creation in the manufacturing and export-oriented sectors fell by a net of 43,000 from the previous quarter, he said. In the same period of 2014, these sectors had added 182,000 jobs.

On exports that have recorded 12 successive months of decline, he said that it was “unprecedented”.

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  1. R
    Jan 2, 2016 at 12:36 am
    If congress has its way then it should have had majority in ejected house that it does not have, people expecting BJP policies since voted them power and congress is disrespect people mandate
    1. b
      Jan 3, 2016 at 2:45 am
      PC might be right but today in India everybody believes the Congress is not interested in India s progress. The Congress is now the villian and no amount of explanations will alter the public perception The Congress leadership has pushed its into a corner and the BJP should not and will not allow it to come out of this black spot.
      1. H
        Jan 1, 2016 at 3:23 pm
        Political Corruption must be curbed by govt at all costs which is reason for roadblock of all development. The political corruption in power must be dealt with iron hand by sentencing corrupt politicians to life imprisonment/ death penalty.
        1. H
          Jan 1, 2016 at 3:17 pm
          Congress leaders have looted this country through thousands of Gigantic scams siphoning trillions of rupees to foreign heavens in last 68 years which is main reason for poverty & backwardness of this country. But present govt is also following path of Sonia Congress by not taking action against corrupts of country who recklessly looted billions of people crippling their lives resulted in they are forced to live in acute poverty. This is main reason of humiliating defeats for BJP in recent embly elections held in Delhi, Bihar & other Civic elections. There is no hope to win future embly elections provided BJP takes sweeping action against corrupts consisting of politicians, businessmen, govt officials & employees etc by convicting & seizing all their ets. Only then BJP has hope to win future elections since people are very unhappy with Modi govt for backtracking over rampant corruption as promised during Lok Sabha election.
          1. G
            Jan 2, 2016 at 4:21 am
            People like Mr Chidambaram were held in good esteem by many earlier for their knowledge and ability. They would have retained their credibility and public esteem and their words trusted now, if they had not become merely jesters and flatterers at the court of the corrupt relics of the dynasty. a simple question is how can tax rate be specified in a consutional amendment? If Mr Chidambaram had not surrendered himself so much to the Madam, he would not be demanding that.
            1. G
              Jan 2, 2016 at 7:23 am
              People like Mr Chidambaram were held in good esteem earlier in view of their knowledge and ability. They would have retained their credibility and trust in their word, if they had not become mere jesters and flatterers at the court of the corrupt relics of the dynasty. A simple logic is that a tax rate should not be part of a consutional amendment. If Mr Chidambaram had not surrendered so completely to the Madam, he would be demanding that absurdity.
              1. S
                Shekhar Shukla
                Jan 1, 2016 at 6:07 pm
                True bull from a party of thieves. First they block important legislations on frivolous grounds and then try and make people believe that others are to blame ...height of hippocracy.
                1. A
                  Jan 2, 2016 at 4:04 am
                  No Mr PC you are wrong.One of the three conditions was withdrawing all the cases against the corrupt Sonia and that has nothing to do with GST.No PM can agree to this.Did you read Mr Surjit Bhalla's column in this newspaper a few days back?
                  1. u
                    Jan 1, 2016 at 4:53 pm
                    One thing no one can blame a true congressman of possessing is honesty.
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