Sunday 24 / November / 2024
New Delhi: Blaming National Democratic Alliance's 'stubborn and unbending' attitude for the GST logjam, Congress on Friday 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 All India Congress Committee(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 Adviser 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.
