Everybody is saying that the discussion is only on a small issue and it must be finished within two or three hours. The Minister has himself mentioned in his Report that the Vote on Account is for a period of four months which comes to one-third of a year and he wants us to discuss it in a span of two hours. Maybe for genuine reasons which I certainly understand but you cannot say that this is a small matter and it should just be passed. If this is the attitude, should we take the time in the same proportion for the General Budget also. No, I am sorry, we cannot.I do not believe in finding fault with the Minister because he has just started his tenure. I have nothing to criticise him as a person. I have gone through the Revised Estimates. I could not find fault with you for this because you are not responsible for it.
Though, the Minister has made it a specific point -- it attracted the attention of the entire news media of the country -- by criticising the performance of the earlier Government -- which, of course, is not a Congress Government -- and telling very clearly that the economy was in doldrums. He himself wrote it. I was fighting it in the Congress Government also. I wanted to bring it to his kind knowledge. In the Central Plan Outlay, page 8, he made provisions of Rs.29,765 crore for energy; Rs.11,356 crore for industry and minerals; Rs.14,570 crore for transport; Rs.14,877 crore for communications; etc. But when it came to social services, he made a provision of only about Rs.13,854 crore. If the Congress Government were to be criticised that it had not taken care of the poor in this country, what is it that he has done which is different from what the Congress Government had done? ...(Interruptions)
MR. CHAIRMAN (SHRI P.M. SAYEED): Please conclude.
SHRI KAVURU SAMBASIVA RAO (MACHILIPATNAM): I represent the Congress Party and I am speaking on behalf of that Party. I am speaking in a genuine manner. I am not provoking anybody.
MR. CHAIRMAN: I am aware of it.
SHRI KAVURU SAMBASIVA RAO (MACHILIPATNAM): Sir, I would like to make a humble submission to the hon. Minister and I want his attention. I can understand his providing any amount of money for education, health care, social services and welfare. But I request that there need not be huge allocations for other sectors, the economic Ministries. I say this because if you give a loan of, say, Rs.30,000 to a common man for purchasing an auto rickshaw, you want him to pay the interest on it, pay the loan back, then he pays the tax etc. But when lakhs of crores of rupees worth of investment is made in Ministries like Railways, Transport, etc., which are supposed to earn income and then feed the budget, he wants to give some more as the budgetary support, I request that the Minister should think over it. I do not say that the Congress Government had not done it. But at least he should think in an innovative way and prove his efficiency and competence.
Sir, many of the important things have not been mentioned in his report like the population control which is affecting the nation too much. I wrote letters earlier to the Prime Ministers of this country also mentioning the methods as to how we can reduce the rate of growth of population which will help the nation in turn. The pathetic condition today is that when we borrow Rs.96,815 crore, our investment on capital assets is only Rs.11,803 crore. Obviously, the hon. Minister must make an effort to see that there will not be any revenue deficit at least in future. If the Government of India itself resorts to revenue deficit, what is the state of municipalities and the State Governments? The crores of rupees collected by way of revenue is not sufficient for paying the salaries and establishment expenses of municipalities. So, should we live, forever increasing the borrowings and making a debt which cannot be serviced by the nation, and collapse like Mexico and other countries at some stage? So, it should be seen to that the expenditure which is going unnecessarily is reduced and the expenditure on capital making assets is increased.
MR. CHAIRMAN: Shri Rao, please conclude.
SHRI KAVURU SAMBASIVA RAO (MACHILIPATNAM): I am going to conclude it, Sir.
When it comes to the question of Defence, we are making an investment of Rs.40,000 crore. Please give a thought! The entire amount of Rs.40,000 crore was being used for Defence only because of the tension existing between India and Pakistan. We have no tension with other countries with which we share borders. So, the Government should think of how best we can reduce the expenditure on Defence by improving our relations with the adjacent countries. This can increase the savings which can be used for servicing the core sector. ...(Interruptions)...
The other factor about which I humbly request the hon. Minister is ...(Interruptions)
MR. CHAIRMAN (SHRI P.M. SAYEED): The hon. Minister will give the reply now.
... (Interruptions)
SHRI KAVURU SAMBASIVA RAO (MACHILIPATNAM): Shri Yashwant Sinha, the other factor which I humbly request you is ... (Interruptions)
MR. CHAIRMAN: Shri Rao, you will have to say the last sentence now.
SHRI KAVURU SAMBASIVA RAO (MACHILIPATNAM): Yes, Sir. ... (Interruptions)
MR. CHAIRMAN: Do not complicate further.
... (Interruptions)
SHRI KAVURU SAMBASIVA RAO (MACHILIPATNAM): Yashwantji, anyway, ... (Interruptions) I am a humble man who goes by the rules, procedures and the factual condition. (Interruptions) I will take more time during the discussion on General Budget. I would request the hon. Minister to give some serious thought to all these matters.
MR. CHAIRMAN: Is it the pleasure of the House to sit up to the completion of the hon. Minister's speech and to take up this matter then?
SOME HON. MEMBERS: Yes, Sir.
MR. CHAIRMAN: The hon. Finance Minister, please.
2101 hours
MR. CHAIRMAN: .. and not to the Chair?
SHRI YASHWANT SINHA: Of course, I am coming to the Chair. I was mentioning the hon. Members first and and I was coming to the Chair, Sir.
We have had a very well-informed discussion at times, not so well-informed discussions at other times. This is a routine exercise. The House is aware that I have come with the Interim Budget and I am pleading with the House to pass the Vote on Account for four months under very exceptional circumstances.
What I have presented to the House is not my own creation. Let us be very clear about it. I cannot be, this Government cannot be, held responsible for what has transpired in the year which is just going by. There was another Government in power. Most of us on this side of the House who were sitting on the Treasury Benches were in the Opposition then and most of the hon. Members who were sitting on the other side of the House were either in the Government or were supporting the Government from outside. It is that Government's doings, that Government's performance that we are discussing that I have placed before the House, yesterday.
Now, Sir, I have said very clearly that everything, the Revised Budget Estimates and the Budget Estimates for the next financial year, do not reflect the thinking and the priorities of my Government. I have said in my Budget speech that it is our firm resolve to review the Ninth Plan and to revise the Budget Estimates so that they reflect our thinking and priorities when I come before this august House with my regular Budget. That will be the time for you to judge us; that will be the time for you to judge our intentions; that will be the time for you to judge our actions. This is not my creation, as I said, but in a parliamentary system we are often faced with a situation where the existing Government has to carry on with the legacy which has been left behind by the previous Government.
Now, I approached my task - I want to be very very honest about it, this Government has been in office for barely one week, with all honesty without rancour.
If you look at the speech which I made before this House, there is no rancour. I would have been less than honest to the people of this country whom all of us represent in this august House, if I had not stated the facts as they are. If the industrial production is down, I have stated that; if the general progress of the economy is down, I have stated that; if the agricultural production is down, I have stated that and if the exports are down, I have stated that.
I would not have done my duty by this House and by the people of this country who have sent us to this House if I had concealed those facts from this House and from the people. Therefore I have stated it. But at the same time I have done it without any rancour. It is not my intention to apportion blame. It is not my intention to unnecessarily put anybody on the defensive. There were special circumstances probably obtaining then. Some explanation has been given. More explanations would have been forthcoming if the former Finance Minister, my immediate predecessor Shri Chidambaram, had intervened and said the kind of things one could have expected from him. But he chose to leave the House probably he had some other preoccupations, some other pressing engagements.
But, Sir, the point I am making is this. We have talked in our National Agenda for Governance that we believe in having a consensus. A point has been made in this House here by the hon. Member, Shri Mohan Singh that we should have the same kind of consensus in regard to economic policies that we have developed over a period of time in our foreign affairs, and in our defence policies. I see no reason why this House cannot evolve that consensus. I am pleading strongly today that we must evolve that consensus so that the economic policy which has become a major tool for the progress of this country, for the well being of the people of this country is not subject to the vagaries, to the exigencies of this situation or that situation. We must have a consensus. I think we are very close to a consensus.
Hon. Member, Shri Rao was saying that I had paid tributes to five decades of progress. Any one who honestly looks at five decades of this country will say that there had been progress. It is nobody's case that there had been no progress. But he himself has not been satisfied with the progress that we had made. We could have progressed probably faster. So, I have no hesitation in admitting that it is as a result of the strength created in our economic system as a result of that progress which had allowed us to withstand those vagaries, those storms which have swept the East Asian countries which were held out as models of economic development before all of us.
In fact we were criticised by many people that we did not follow exactly the path followed by those countries. We were criticised in this House, we were criticised in this country that we did not follow the path followed by some East European countries, including, the old Soviet Union. There was a thinking at that point of time - I do not know whether my friends from the Left still hold on to that - that that was the best model of development. That model of development has collapsed. Then, we were told that these market-economy countries of South Asia were the best models of development and India should follow those models of development. They have collapsed today. They are going round the world with begging bowl. Therefore, Mr. Chairman, I would like to emphasise before this House that the only model of economic development that India can follow is the uniquely Indian model of development. There is no model in the world which India can follow successfully except the model which we must devise on the basis of the concepts and the precepts which have been handed down to us by the great leaders of the past belonging to all shades of opinion, belonging to all the political parties. If we do that, then consensus-building will not be difficult.
I have heard here and I am sorry to say some hon. Members have talked as a matter of fun, in a very very light-hearted manner about swadeshi. I am sorry that is not the way swadeshi should be looked at. It is a matter of no shame for this Government that the bedrock of our economic policies will be swadeshi and swadeshi is exactly what hon. Member after hon. Member in this House has articulated. Swadeshi is defending, protecting and safeguarding our national interests.
People have talked about foreign investment. Now it is a very unfortunate development of the last few years, not that foreign investment has started to come in, but the fact that foreign investment has become the sum total of the economic discussion in this country. Wherever you talk about economic policy, you go to a TV debate, you talk to the media, if we discuss it in Parliament, everywhere, the emphasis is: are we for or against foreign investment; are we for or against multinationals?
I hope that the hon. Members, Sir, are aware that foreign investment at the best of times has played only a marginal role in our economy. Over a period of time, it has been less than two per cent of the total investment which has been made in this country.
If according to the latest data which is available with me, if 26 per cent of the investible fund came from our domestic savings, then only a little over one per cent came through foreign investment. Now should that be the central theme, the central point of our discussion and economic policy parameters should be judged only on that one point? Foreign investment, I have absolutely no hesitation in stating on behalf of my Government, is welcome. But foreign investment in India is welcome in certain areas which we call priority areas which include the infrastructure. And we are not interested in foreign investment in areas where we do not need foreign investment, where we do not need foreign technology, where there is no need for such foreign investment, where the foreign investor is not coming for our good. He is coming to this country or wanting to come to this country only for his own profit.
We have the entire society. Much has been said here about the poor people of this country. Do we want to create a society which is based on such utter disparities, that we will not be able to control the social tensions which will arise as a result of those disparities? Do we want to create islands of prosperity based on such consumerism which the rest of the people of this country will not tolerate? And then the walls around the residences of the affluent will go higher and a little more high and a little more high. Ultimately, they will all be demolished because the poor people of this country are not prepared to tolerate that kind of affluence when they themselves are living in such apathy, in such poverty. We have to remember that this country can ill afford policies of that kind.
And if I have, my Government and its policies have a slight difference of opinion with the policies followed by the previous Government, the Congress Party when it was in power or by the United Front Government supported by the Congress Party when they were in power, it is only about not making foreign investment the central theme of our economic policy. It has a role to play. We will allow it to play that role but the sum total of economic policy is far more, is far greater than that and any economic policy of any Government which does not bother about the poor people of this country, which does not take into account the rural economy of this country, is not worth the paper. That policy is written upon. Therefore, Sir, let me make it very clear that we shall... (Interruptions)
PROF. P.J. KURIEN (MAVELIKARA): Hon. Minister, will you hear me? Sir, the Congress Government has not made foreign investment its central policy. We wanted foreign investment in order to strengthen our industry because along with investment, we wanted technology also to come, so that our industry is sustained. To say `the central theme of our foreign investment only' is not correct.
... (Interruptions)
MR. CHAIRMAN (SHRI P.M. SAYEED): The hon. Minister has yielded to him.
SHRI YASHWANT SINHA: The results of the policies which have been followed during the last seven years when the process of liberalisation and economic reforms were initiated, are for everybody to see.
Unfortunately, I do not have the time to go into the details. The demand for level playing field by the Indian industry has arisen not from our Party, not from the Parties which are in Government today; it has been raised by the Indian industry. I am not saying that we believe in the level playing field also. But I have said and I would like to say on the floor of this House that this Government shall not accord to the foreign investors any privilege or any concession which is not available to the Indian industry. That is our policy. Therefore, it is important that we give preference to the domestic savings of 26 per cent. We have said it in our National Agenda for Governance. The Rashtrapatiji has said that in his Address to both the Houses of Parliament. We want to take it to 30 per cent in the next five years.
Domestic savings would be increased from 26 per cent to 30 per cent, and if we raise it by two per cent, then look at what we can achieve. Instead of depending on that one per cent of foreign investment for which we have to be prepared to spend so much time and energy, we will welcome foreign investment. We will define what exactly we mean by priority and non-priority. We will define the policy in such a transparent way that nobody will be in doubt either within the country or outside the country. I promise on behalf of my Government to this House that we shall set up a completely hassle free regime for foreign investment as for domestic investment.
You know what has happened to the fast track power projects. Eight fast track power projects were taken up in this country. The proposals were invited. Those proposals have not been moved for seven years despite the fast track. What kind of fast track projects are they? I am unable to understand. If it was no track at all, where is the question of fast or slow? Now, we have to get rid of such a mind set.
I entirely agree with you that these procedures have to be simplified. I promise you that that is exactly the area we are looking at and we will make sure that investor confidence is restored both for the domestic as well as for the foreign investor by our actions, not merely by our words. But I can promise that this confidence of the Indian investor and the foreign investor in India will be restored and for that reason I agree entirely with the suggestion which has been made here that we have to look at the small investor. The small investor has burnt his fingers a number of times. He has been cheated; he has lost his money. It will be the concern of our Government to make sure that we build a system in this country by which nobody and absolutely nobody will be able to cheat the small investor and his investment will be protected.
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