UPA turned clock back on economic reforms: BJP

Launching a frontal attack on Finance Minister P Chidambaram for backtracking on his commitment to economic reforms in Budget 2007-08, the Bharatiya Janata Party (BJP) today questioned his "taxation philosophy."

Criticising the government's move to control cement prices through fiscal measures and impose duty to the tune of Rs 300 per tonne on iron ore exports, former finance minister and senior BJP leader Yashwant Sinha declared that if the BJP came back to power, it would abolish the banking cash transaction tax (BCTT) and fringe benefit tax (FBT).

Sinha took a dig at Chidambaram for the government's dilly-dallying over the pension reforms, while beginning a discussion on the General Budget in the Rajya Sabha.

An Ordinance was brought for the pension reforms, followed by a Bill, which was referred to the Parliamentary Standing Committee.

The committee's report has been pending since 2005.

Sinha said the government had adopted a similar approach to full capital account convertibility, and banking and insurance reforms, and dared Chidambaram to bring pension and banking Bills if he was committed to reforms.

"They (UPA) have turned the clock back on what we started as economic reforms," said Sinha.

The BJP leader's swipe at the finance minister, for using fiscal measures to control cement prices "" increased by Rs 12 by manufacturers "" drew sharp reaction from Chidambaram.

"Should the government keep quiet if cement manufacturers increase the prices by 40 per cent in 7-8 months? I may succeed or I may not succeed. Tell me what the BJP would have done? Tell me the BJP's stance on this," said Chidambaram.

However, Sinha refused to do so, arguing that the BJP was not in power.

Sinha further contested the FM's claim that he was imposing the said iron ore export duty as per the suggestions of the Hoda committee.

The committee suggested that duty may be imposed on lumps, and not on fine. as a result of this export duty, China has refused to import it.

"Will he ensure that eighty-nine million tonnes of fine is bought by domestic steel industry?" question the BJP leader, adding that the move will result in massive unemployment.

Sinha termed BCTT and FBT as "two evil taxes". He demanded from the FM to furnish details as to how much black money has been unearthed through BCTT.

Referring to the recently unearthed racket led by Pune's Hassan ali, the former FM quipped, "Why didn't you discover it through BCTT? Tell the House about Ali because there are rumours about involvement of politicians..."

Sinha criticised the budgetary proposals for failing to address the concerns about agriculture, suicide by farmers, inflation, stagnation in household savings, et al.

Referring to the proposal to start a pilot project to deliver fertilisers to farmers directly, Sinha said that the FM had been starting some pilot project or the other every year without any concrete results- pilot weather insurance project in 2004, for instance.

The government also came out with some new idea in infrastructure sector every year without any concrete result: inter-institutional group in 2004, Special Purpose Vehicla in 2005, and Infrastructure Finance Company in 2006.

"Infrastructure is not moving forward. In the last three years, not a single major infrastructure project, compared to the national highway development programme of the NDA, has been started," said Sinha.