Its time we thought about the country and not politics

The interim budget presented yesterday was a total washout. This is again another example of what the priorities of politicians are. They think of politics first and everything else comes later.

The world economy is in shambles. Our economy is going from bad to worse. People are losing jobs. Companies are closing down. More such bad news is expected and all the government and politicians could think of was “propriety.” Politicians should be the last people to think of propriety considering their actions. The country and the people of the country and their interest is the most important. Even the primary interest of the constitution is the country and its people.

Government was aware of the election timing. As such, they should have taken additional action before it became improper for them do so. I have already stated in my earlier post, income taxes should have been reduced to place more money in the hands of the consumer so as to increase consumption. Excise and service tax should have been reduced to reduce the cost for the consumer to enhance demand. Service tax is very high thanks to Shri Chidabaram. In addition, the least that the government should have done was expedite Income Tax refunds which would have placed money in the hands of the consumers as well as companies to spend. It would also eased the liquidity of the companies.

In addition, government spending on small infrastructure projects which would lead to immediate flow of money should have been given a impetus. Big infrastructure projects will take time to implement but smaller infrastructure projects which do not have too many regulatory compliance would be faster to get moving.

Everyone should realize that once demand is there, everything will fall in place. Demand will come from people who are employed.

I would like to suggest one more action that the government should have taken quite some time back. They should have asked every industry association to give suggestion as what actions can be taken which will facilitate them in doing business without hassles. For instance, let us modify any any laws, rule or regulation is not grounded in reality. Such a step will build the confidence of entreprenuers to increase their business.

Lastly, let us accept that the government wanted to behave ethically, still they could have taken action for the benefit of the nation and its people. For instance, they could have come out with a joint budget, that is, brought all the parties together and come out with a budget to address the slowdown. I doubt if there would be any party which would be opposed to bring down Income Tax rates at least for the current year, excise duty and service tax for one year. No one party could have taken credit for this and also it would not have violated constitutional propriety. I think they can still opt for this option.

It is obvious that the government was not thinking of the country and its people. Now the economy would be on hold for 5-6 months and the situation could get worse.

Avinash Narula

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