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Budget: RSS offshoots frown at increased FDI and disinvestment
While it welcomed the modification in the company law that will facilitate in the easy compliance for all small companies, the LUB pointed out that its demand for reduction in the tax rates for partnership firms has not been met
Affiliates of the Rashtriya Swayamsevak Sangh (RSS) that work in sectors of labour and MSME on Monday hailed the Union Budget for laying the ground for economic development and for the focus on employment generation but were critical of the government’s policies on disinvestment and increasing the FDI in the insurance sector.
The Swadeshi Jagran Manch that pushes for indigenous production and has been at the forefront of pushing for a rejig in India’s trade policy to make the country less dependent on imports, said allocation of more funds for infrastructure; announcement of new infrastructure projects; efforts for the revival of industries closed due to Chinese imports, and an unprecedented increase of 137% in spending on health, the allocation of additional funds for research and development (R&D) are all welcome measures.
“Despite a Fiscal Deficit of 6.8% next year, we will be able to not only have high growth of GDP, but also bring back employment opportunities, hampered during pandemic last year and killed in the last two decades due to onslaught of Chinese imports,” SJM’s co-convenor Ashwani Mahajan said.
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Mahajan said the Production Linked Incentives (PLIs) worth ₹1.97 lakh crore is a major step towards revival of manufacturing in the country and a jump from ₹4.12 lakh crore for capital expenditure to a provision of ₹5.54 lakh crore for the coming year is a welcome move.
The SJM, however, said the announcement of disinvestment of BPCL, Air India, Shipping Corporation of India, Container Corporation of India , Pawan Hans, Bharat Earth Movers Limited (BEML), manufacturer of rolling stock for Metro and raising the FDI limit in the insurance sector from 49% to 74% is “worrisome”
“The government should reconsider this decision. The announcement of privatisation of public sector banks and an insurance company is also worrying,” Mahajan said.
The Laghu Udyog Bharati (LUB) that works in the MSME sector said the emphasis on huge spending to encourage and sustain growth and providing crucial support to the industrial sector will be beneficial to the micro and small industries also. “In the recent past there was steep hike in the prices of steel and textile. In the budget the government has announced reduction of import duty on raw material of steel and textiles, which will benefit micro and small industries. Further the scheme of mega investment in seven textile parks will also be beneficial for employment generation,” the LUB general secretary Govind Lele said.
While it welcomed the modification in the company law that will facilitate in the easy compliance for all small companies, the LUB has however pointed out that its demand for reduction in the tax rates for partnership firms has not been met.
The Bharatiya Mazdoor Sangh (BMS) that works in the sector of labour was critical of the government for the proposal to amend insurance act to increase FDI in insurance sector from 49% to 79% as well as relaxation of foreign investments in infrastructure.
Binoy Kumar Sinha, general secretary of the BMS, said “combining the concept of Aatmanirbhar Bharat with FDI and disinvestment in the union budget is disappointing for the employees.”
He said the “aggressive disinvestment programmes” like divesting two public sector banks and one general insurance company, asking the Niti Aayog to list out new companies for disinvestment, approving disinvestment in non-strategic and strategic sectors among other measures to address fiscal deficit “will reduce the charm of the Aatmanirbhar Bharat.”
While the BMS welcomed the mega textile parks and major fishing harbours it said there is no support to millions of existing workers. “None of the demands raised by BMS and other trade unions has been incorporated in the budget except a special scheme for tea workers in West Bengal and Assam thus making the consultation a mockery. There is no increase in the much expected EPS pension amount or medical scheme for pensioners as demanded by BMS. Women workers are being compelled to do night shifts and there is no income tax relief in spite of adverse effect of the pandemic situation though corporate tax has been reduced, Sinha said.
