Kochi: Development is meaningless if it does not generate jobs in India, where 70 per cent of the population lives in poverty, said Deepak Nayyar, a well-known economist and emeritus professor at JNU. The third Union budget of Arun Jaitley does not contain recommendations to boost job creation in agriculture and industry, he said. Nayyar was delivering the seventeenth budget speech organised by Malayala Manorama.
The Union budget contains just words and symbolic measures to create favourable political atmosphere. At a time when foreign and private capital investment is held back due to economic slump the way to raise domestic consumption was to increase the government’s public expenditure. The circumstances were favourable because of lower oil prices and low inflation. However, the finance minister wasted such a golden opportunity by citing financial discipline, Nayyar said.
The insistence on lowering fiscal deficit to 3.5 per cent of domestic output was unnecessary. If money is used for capital expenditure, there is nothing wrong in borrowing and fiscal deficit increasing. There would not have been any problem even if fiscal deficit was 6 per cent of domestic output. Public expenditure would have risen and job opportunities would have increased as a result, he said.
The finance minister did not take this step that would have energised the economy. Whether fiscal deficit would fall to 3.5 per cent is worth watching, Nayyar said.
Bad budget speech
According to Nayyar, Union finance minister Arun Jaitley needed good writers to prepare the budget speech. "The budget speech was not good. Major issues did not get adequate consideration in the budget that put emphasis on small issues. The budget got drowned in a flood of words. The budget looked like the sketch book of school students. On a sketch book, you can create a picture by joining dots. But if there are not enough dots, there will not be a good picture. This is what happened to the finance minister. Funds allocated for the numerous projects were inadequate, Nayyar said.