SHRI P. CHIDAMBARAM: Madam, when there is no problem, Shri Ramesh Chennithala intervenes. Why you not intervene, when there is a problem? You do not worry. Do not create problems which are not there. You are most welcome. You know me. You walk into my Chamber any time you want to walk into. Kerala people walk into. Shri P. C. Chacko telephones and speaks. You know that I pick up the telephone in the morning. You know that very well.
So, what is the problem? We can always intervene when there is a problem. There is no problem about rubber. I am confident that rubber industry will grow. We have the highest productivity in rubber manufacture. In the last seven years, India has become the top producer in rubber in terms of productivity. Acreage has to be extended. Land is at a shortage. We have got a major rubber World Bank Finance Project going on in Tripura in North East. We will become one of the leading producers of rubber. Let us give confidence to our farmer. Let us not saying anything which will make him diffident. Nothing will happen to rubber. Rubber prices are good. This is a flush season. We are not allowing any imports now. We are not even allowing imports to meet the gap now. Rubber is good. Rubber will be good. Do not have any worry about rubber. SHRI MULLAPPALLY RAMACHANDRAN(CANNANOR): There is a good price for rubber farmers.
SHRI P. CHIDAMBARAM: Thank yu very much. If, at any time, the rubber farmer complains, let me know. I will tour Kerala once again.
There has been some criticism about fishing implements. Shri G. M. Banatwalla was here. I have accepted what Shri G. M. Banatwalla says.
PROF. RASA SINGH RAWAT (AJMER):
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BEò iÉ®ú¡ò iÉÉä ºÉ®úEòÉ®ú EòÒ xÉÒÊiÉ ªÉ½þ ½þè ÊEò ±ÉPÉÖ =tÉäMÉÉäÆ EòÉä ¤ÉgøÉxÉä Eòä ʱÉB |ÉÉäiºÉɽþxÉ ÊnùªÉÉ VÉɪÉäMÉÉ +Éè®ú nùںɮúÒ iÉ®ú¡ò ºÉÆMɨɮú¨É®ú Eòä xÉÉ¨É {É®ú {ÉilÉ®ú ÊSÉ®úÉ<Ç EòÉ VÉÉä EòÉ¨É ½þÉäiÉÉ ½þè, =ºÉEòÒ |ÉÉäºÉäʺÉÆMÉ ¨ÉäÆ EòÉ¨É +ÉxÉä ´ÉɱÉä ºÉɨÉÉxÉ EòÒ ¨ÉèxÉÖ¡òèESÉÊ®úÆMÉ xɽþÒÆ ½þè*SHRI P. CHIDAMBARAM: There is no rubber in Rajasthan. It is marble.
PROF. RASA SINGH RAWAT (AJMER):
This is a processing unit. A Memorandum has been given. In spite of that, no action has been taken.May I request on the floor of the House kindly to withdraw increase in excise duty on marble processing units so that those units can be profitable?
SHRI P. CHIDAMBARAM: I have to raise money somewhere and if I put Rs.30/- a square metre on marble, I do not think anybody should complain as a result of that. Marble is not used by poor people. Marble is consumed by affluent sections of society. Marble is not a poor man's commodity. I have already responded. I am sorry I cannot do that. I have already responded to Shri Jaswant Singh's request if I can give a small scale exemption. I have already responded yesterday. I am sending a team. They will look into the matter to see whether the small scale can be exempted. But I do not propose to reduce the excise duty on marble. When marble becomes a poor man's commodity, we will consider reducing excise duty. (Interruptions).
PROF. RASA SINGH RAWAT (AJMER): I am not talking about the business of the marble. I am talking of gangsaw units which were established by taking loan from RFC in Kissinger, Ajmer in my Constituency. There are 500 such units. Ten thousand workers are employed there and they will suffer. The units will be closed. They will suffer.
SHRI P. CHIDAMBARAM: There was some criticism about Out Board Motors. I think the criticism is justified. I have accepted it. I, therefore, propose to reduce the customs duty that has been imposed on Out Board Motors which are not manufactured in India and which have to be imported. Many of them are fitted into fishing vessels. I am reducing the customs duty from 10 per cent to five percent and appropriate notification is being issued. The effective rate will be now a little more than 15 per cent last year but the corrected, effective rate including the CBD will be 17.9 per cent as opposed to 15 per cent on the Out Board Motor.
On the Out Board Motor spares, I am reducing the customs duty on Out Board Motor spares for motors to be used in fishing vessles to zero per cent so that these spares will be available to keep the motors running. Otherwise, these motors will not run and then the fishing vessels also will be grounded. Therefore, I am reducing it to zero per cent. But this is only on a certification given by the Fisheries Department of each State. Therefore, there is no general exemption. It is only for the fishing vessels. The effective rate will then come to 15 per cent. I am grateful to Shri G.M. Banatwalla for drawing attention my towards what turned out to be an anomaly.
Finally, on newsprint, as everyone knows, there are pros and cons. I do not wish to take any decision in a hurry. I have spoken to my friends in the BJP and in the Congress (I). I was looking for Mr. Jena. But now that the Prime Minister is here, I can have the liberty of speaking to Mr. Jena also. We have to balance the interests of the importer, the domestic producer and the reader of the newspaper. It is true that, as Commerce Minister, on behalf of the then Government, I announced that the prices crashed and we would make a suitable correction in the customs duty which was zero per cent. But there are various views. There are clashing views. I think we should look at it a little more carefully. I have requested each of the parties to kindly suggest the name of an hon. Member. A small group of four or five Members of Parliament can look into the matter. It is not a Budget-related matter. I can do it by a notification. The BJP has kindly suggested the name of Shri Jaswant Singh. The Congress (I) has kindly suggested the name of Shri P.M. Sayeed. The Prime Minister and Shri Jena can suggest the name of somebody from the United Front. From the CPM, I would request Shri Nirmal Kanti Chatterjee to sit on that group regarding newsprint. Let the four or five of them sit down together. Whatever recommendations they make, I think we could consider a trigger point at which either the duty will be levied or the duty will be removed. But this is only a suggestion. I leave it to the hon. Members. We are not trying to score points. Let the four or five hon. Members sit down. In the next two or three days, they can hear whatever opinions have to be heard. They can give a recommendation. I will make it by a suitable notification. So, I think I have answered the major questions that have been raised.
SHRI MULLAPPALLY RAMACHANDRAN (CANNANORE): You have not referred to edible oil.
SHRI P. CHIDAMBARAM: I will answer that.
SHRI RAM NAIK (MUMBAI NORTH): You have not said anything about pencil sharpeners.
SHRI P. CHIDAMBARAM: The duty has been removed.
SHRI RAM NAIK: But that has not been indicated in the statement yesterday.
SHRI P. CHIDAMBARAM: I think, by a notification, it will be done. Anyway, if it has not been done, it will be removed.
SHRI RAJIV PRATAP RUDY (CHAPRA): Why have you reduced the duty on plastic and PVC? That is resulting in dumping of PVC. It is adversely affecting the environment.
SHRI P. CHIDAMBARAM: Dumping is a different thing.
SHRI JASWANT SINGH (CHITTORGARH): Madam Chairman, I made three requests. When fshe took the notes, I hope the hon. Minister has deliberately omitted those three requests.
SHRI P. CHIDAMBARAM: I have your points. What are those points?
SHRI JASWANT SINGH: One was a request which, if I recollect right, met with almost a near unanimous support. There is no need whatsoever to put this duty on sports goods.
SHRI P. CHIDAMBARAM: I am responding to this. I am going to respond.
SHRI JASWANT SINGH: I thought you have finished it.
SHRI P. CHIDAMBARAM: Shri P.R. Dasmunsi reminded me to respond. Which are the three points? Please tell me.
SHRI JASWANT SINGH: The first was about sports goods. The second was reconsideration of excise duty on motor vehicle related to energy efficiency and pollution control matters and the third was the consideration of vegetable oil duty because it directly affects the agriculturists and the producers.
There are two more issues. One is, why do you not treat the deserts of India on the same terms as you treat the North-East and the hills of India? Could I tangentially make a request to the Minister of Industry about the Instrumentations Limited, Kota?
SHRI P. CHIDAMBARAM: I do not think it is necessary to respond to each one of these because some of these require a little more consideration. Now that four or five issues have been mentioned, I will respond to them very briefly.
Firstly on sports goods, it is not as though the opinion was unanimous because Shri Priya Ranjan said that he only wanted zero duty and a simpler procedure for sports goods imported by recognised associations, clubs and teams. There is a growing sports goods industry in India. I have visited Jalandhar. I had interactions with them as the Commerce Minister. We need to encourage the sports goods industry to grow. At the same time, I recognise that a number of sports equipment ought to come in at very low duties. I have brought down the duty from 50 per cent to 30 per cent. I am willing to consider further reduction of duty. But I must consult with the sports goods manufacturers to ensure that whatever indigenous capacity they are building now is not affected by a drastic reduction of duty. I have made a note of it.
Secondly, on the energy efficient cars, I am afraid, over a period of years, by tinkering over one rate and another rate, we created a completely irrational set of duties on cars. In fact, there was something by weight; something by passenger capacity. Now we have got rid of that. We simply go by the time-honoured definition of the Motor Vehicles Act based on passenger capacity. Now we have fixed three rates according to the passenger capacity and the industry has accepted it. What you are saying is: "Can you punish somebody for polluting and being inefficient?" It has really nothing to do with the excise duty. It is an additional polluting tax that has to be levied or a tax based on fuel efficiency. It has nothing to do with the excise duty; excise duty is on manufacture. What we have done is the right thing. But I am willing to consider whether any other kind of polluting tax or inefficiency tax ought to be levied on some kind of vehicles. But that requires more careful consideration.
The third thing was, whether the concession extended to backward areas and districts can be extended to deserts. That again requires a careful consideration. But I think, if some of these desert areas also fall under the backward districts which have not been notified - there was a Committee appointed by the previous Government for this - then maybe, a part of the problem may be taken care of.
Then comes edible oil...(Interruptions)
SHRI NIRMAL KANTI CHATTERJEE (DUMDUM): Wherever they are, they are turning it into deserts...(Interruptions)
SHRI P. CHIDAMBARAM: He says: "Wherever you are, you turn it into a desert."..(Interruptions)
SHRI P.R. DASMUNSI (HOWRAH): What about donations to sports bodies? You said that you would refer to it.
SHRI P. CHIDAMBARAM: I said, I will make the procedure simple. I agree that the procedure is bad. There is a procedure today. That procedure is a little more complicated. I want to make the procedure simple. It comes today at zero duty.
SHRI MULLAPPALLY RAMACHANDRAN (CANNANOR): Do not give any concession on sports goods because the Indian contingent has got 104th place.
SHRI P.R. DASMUNSI: That is why, you must give subsidy, Sir.
DR. K.P. RAMALINGAM (TIRUCHENGODE): What about subsidy on heavy tractors?
SHRI P. CHIDAMBARAM: On edible oil, please see the situation. There is a huge gap between demand and supply of edible oils. In 1995-96, production was only 65 lakh tonnes but the demand is 72.54 lakh tonnes. In 1996-97 also, we expect a demand gap of a slightly higher order. Now what we are importing, only meets that gap partially. It is true that the domestic producer of Soyabean and other oil seeds must be protected. At the same time, I must also ensure that the millions of people who consume edible oil get it at a reasonable price now. One of the reasons why people are extremely happy is that duties on edible oil have been reduced from 30 per cent to 20 per cent.
Now, the question is, is this 20 per cent adequate protection for anyone who grows oilseeds in India? I believe, 20 per cent is adequate protection. Well, it is not as though, any soyabean or any other oilseeds is taken to India. We tried to import soyabean last year but we ran into quarantine problem. Then quite rightly, the quarantine problem was formidable that they gave up the idea of importing soyabean. I think, there is an opportunity to import soyabean, use the capacity in Madhya Pradesh and elsewhere to crush soyabean, extract the oil and export the soyabean extract as a meal. But we cannot do because there are very strict quarantine restrictions. So, I do not think, there is any danger to the oilseeds farmer. And, I think, 20 per cent customs duty is enough protection for him.
And, it also helps the consumers here. Fortunately or otherwise, Indian consumers require oil. There is no meal which is cooked without oil. We consume the largest quantity of oil. By reducing the customs duty, edible oil prices have fallen or at least did not rise as one would have expected that it would rise. So, I think, keeping both the consumer's interests and oilseeds producers' interests in mind, we have struck a balance and kept it at 20 per cent and I think, it is a correct one.
Will it affect coconut, the copra? I am afraid, it will not. Again, we allow import of all edible oil. We do not allow import of coconut oil, that only to protect the coconut farmers.
Look at the prices of copra. On the 17th of July, the price of copra in Alapuzha was 2,600 per quintal. It has now risen to 2,900 per quintal. In Kochi, on 17th of July, it was 2,580 per quintal and today it is 2,770 per quintal. So, it is not as though that 20 per cent duty that I impose on edible oils from 30 per cent has caused a crush in copra prices. That is not so. The demand is outpacing supply. So, if the demand is outpacing supply, nothing will happen to prices. Prices will be reasonable and remunerative to farmers.
Anyway, we are watching it virtually everyday. I am looking at it everyday and I am concerned about these products because I know that these are not only the raw materials for the industry, these are bread and butter of the farmers of this country. I am very conscious of this matter while I take these decisions.
SHRI N.K. PREMACHANDRAN: Sir, what about 10 per cent reduction on import duty on rutile? This is affecting the two major indigenous industries namely, KMML, Chavra and Travancore Titanium Products, Trivendrum. Rutile is extracted from mineral sand which is easily available in Kerala coastal areas.
SHRI P. CHIDAMBARAM: The raw material comes, virtually at no cost. I do not want to get into it. I am willing to discuss with you. I have gone into as to why that factory is not doing well. It is working at a very low capacity utilization. It is the capacity utilization of that factory, which is the problem. But I am willing to sit and discuss with you separately.
SHRI P.C. CHACKO: Sir, that is not like that. It is the titanium dioxide rutile grade which is taken. It is not raw material. We are manufacturing titanium dioxide rutile grade in our country. That import duty is being reduced, that is affecting the indigenous industry.
SHRI P. CHIDAMBARAM: The raw material for that is available in the sands of Kerala, virtually at no cost, a little cost. Yet, that factory is not doing well when it is getting raw material virtually at no cost.
I have gone into it -- I mean, I am talking from my memory again -and I believe, it is working at a very low capacity utilization. Its rated capacity is much higher. Its capacity utilization, a couple of years ago was higher but it has come down. I think, the problem is at different level. It is not because of customs duty being reduced. You can import all the rutile you can. But you are not working your factory to the capacity at which it will be viable. Anyway, I am willing to go into it and then come back to it.
Madam, on tractors, we have only given subsidy for tractors of a certain horse powers, I think, 25 horse powers or so of Rs. 30,000. Now, even that has been criticized as a bonanza to the big farmers. A small farmer uses, if at all, only a small tractor. Why should I give the subsidy to the big tractor?
DR. K.P. RAMALINGAM: It is not only tilling with a small tractor. The big tracators are also being used for that.
SHRI P. CHIDAMBARAM: The small farmers did not even buy small tractors.
SHRI SONTOSH MOHAN DEV: Nowadays, under your scheme power tillers are given. That you can consider, in future.
SHRI NIRMAL KANTI CHATTERJEE: He is less cynical than the earlier Government. He has extended the facilities to all farmers. Previously, it was only marginal farmers. I do not know how they can go in for power tillers.
SHRI SONTOSH MOHAN DEV: I am glad that you are supporting his policy.
SHRI P. CHIDAMBARAM: On power tillers we are giving a subsidy and I think that should take care of the farmers.
DR. K.P. RAMALINGAM (TIRUCHENGODE): In power tillers there are two divisions.
SHRI P. CHIDAMBARAM: We are giving Rs.30,000 subsidy to small tractors. I do not think there is a case now for giving subsidy to large tractors. I think we should leave it there.
I am grateful to the hon. Members and I request them to pass the Finance Bill.
SHRI SONTOSH MOHAN DEV (SILCHAR): In the Finance Bill we expected you to say something about the recommendations sent by the salaries committee. But you are conspicuously silent about it.
SHRI P. CHIDAMBARAM: I have received no recommendation.
SHRI P.R. DASMUNSI (HOWRAH): I had raised a point yesterday during the debate.
MR. CHAIRMAN (PROF. RITA VERMA): At the Third Stage, not now.
The question is:
"That the Bill to give effect to the financial proposals of the Central Government for the financial year 1996-97, be taken into consideration."
The motion was adopted.
MR. CHAIRMAN (PROF. RITA VERMA): The House shall now take up clause by clause consideration of the Bill.
Clause 2