Open letter By Amit Daga
Dear Mr Finance Minister,
I graduated around the same time when UPA came into power first time, in 2004.Despite belonging to a middle class strata of society and from a tier-III city with no higher education or degree I rose the ladder of financial market world as a commodity & currency trader.
I even managed to work in some of the great cities of our country and even abroad and earn well enough to spend and enjoy my life. I even survived the financial crisis of 2008-09, but thanks to various steps taken in last two years and apathy towards the FCRA bill many careers ended in the last few years. But I am not writing this to discuss those issues, after all I am part of a very small constituency.
The Finance Minister presenting the vote on account. Reuters I have a few points to make which I discuss later in brief here point by point. But before that I must applaud you for all the juggling of numbers and mockery of statistics in broad daylight.
a) In your interim budget you propose excise duty cut in automobiles sector specially in small segment car by 4 percent i.e. roughly Rs 10,000 – 17,000 discount in that segment. We know the automobile sector, specifically the small car segment, is bleeding and facing its toughest time in last decade. But a mere 4 percent cut in this segment while giving larger sops to SUV market,which is anyway growing far more than other segments, is a complete nonsense in my view. People like me are not buying cars because inflation is eating into my household budget, job uncertainty does not allow me to opt for a car loans. Why would I buy a car for a mere discount of a few thousand rupees when my I have greater concerns. Dear FM, you need to fix other things first before you ask me to buy a car.
b) You are bailing out Air India, but have no future plan for our shrinking public transport system facility. Subsides are so high that I prefer to leave it for an economist to tell you the reality. However, the Rs 2,600 crore subsidy as a moratorium on student loans is not what exactly me,my colleague or my brother will be looking for. On the contrary, the fact is jobs are shrinking even as graduates are being produced by our shattered education system. Instead of doing that, you could help those students get jobs then they will take care of principal and interest themselves. It also is discrimination against those who paid the their loans on time.
c) By reducing excise duty on consumer and capital goods by 2 percent you are laughing at our misery. When food inflation and rising cost of living is a threat to many, buying an air-conditioner will be the least of my priorities. You smartly reduced taxes on cheap mobile handsets, but your recent spectrum auction bill (to fund your extravagant spending on flagship schemes) will definitely increase my mobile bill by more than 10-15 percent as per various reports in media.
d) Dear FM, you specifically mentioned that your mother and faculty at Harvard taught hard work. No one taught us, but we are forced to work hard at our daily chores. Thanks to the financial crisis, the hot money from various stimulus packages from developed countries keep your forex reserves full so that you can take credit for all the goodies in parliament. The fact is a $15 billion rise in FX reserve is doing nothing but adding more debt on your books. You pat yourself for manufacturing and export sales rising, but you must admit that a small country formed in 1971 is exporting far more garments. The reality is rupee depreciation just ensures some healthy competition in pricing for them. You did very little to discourage import in various sectors except hitting gold imports and curbing currency trading to inflate the currency. CAD comes down heavily because many imports become impractical. However, you and your government must be lauded for all the good steps you have taken in the last ten years to revive economic growth and ensure large scale ‘development’.
ps: I am no Amartya Sen, Jean Dreze, or a economist. I am just a small trader who is waiting for next government in the hope of it creating employment opportunities through real reforms. I end my painful letter with this simple quote: “Get your facts first, and then you can distort them as much as you please.” –Mark Twain