Union Budget exercise – I
With reference to the article entitled `Union Budget 2018-19: Promises development for all but fulfills monopoly capitalist greed’, this article was written before the budget was announced and its predictions have essentially been borne out, thereby vindicating the high level of theoretical and practical development of the revolutionary theory and practice of our party. Indeed, the hallmark of the budget has been the emphasis on the rural sector and a lot of praise has been heaped on the lip service to the vast millions and their families engaged in agriculture in the country. Governments have come and gone, under the UPA or under the NDA, and yet the orientation of the economy has always been one where the countryside is constantly driven into deeper and deeper despair with each passing year. The effects are there for everyone to see with the increasing pauperization of the rural sector and the subsequent migration of the rural population to cities looking for jobs and income which have heightened the suffering on both sides.
The article also points out the scheme of the pre-budget consultations carried out by the Finance Minister, who spent less than 5% of his time meeting with representatives of 95% of the population and the rest with the richest of the rich and their spokesmen. As such, under the NDA Government, the robbing of the rural masses and the peasantries has reached intolerable highs, and yet it must be reiterated that it is only the continuation of policies of previous governments. The article has also taken great pains to explain precisely what the steps are that the monopoly capitalists wanted taken by the Union Government to ensure the best returns on their investments, and to make the economy more investment friendly, in other words, ensure the best possible conditions for the largest rates at which looting of the people can take place.
The annual budget ceremony is an important indicator of the thinking of the monopoly capitalists who use the occasion to publicly put forward their claims on how the economy must be fine-tuned. This is also an occasion for us in the revolutionary camp to once again remind ourselves that it is the duty of the State to ensure the security and survival of everybody, and not just those with the most private property.
It is also a good time to note that most of the fine tuning comes from constantly increasing cut backs on public funding on basic necessities including education, transportation and other social services. Furthermore, the constant refusal to put in place a proper public distribution system, and to offer proper remunerative prices for farmers is part of the plan to drive peasants into greater debts so that they may sell of their land, not offering their suitable debt relief, while at the same time writing off corporate debt is the part of the same game of fulfilling corporate greed.
Again, the article ‘”Restructuring” of Indian Railways points out the orientation of the economy reflecting that it is a program to wreck a valuable public asset so as to fulfill monopoly,’ in the same issue highlights the course the railway budget was expected to unfold. The railway budget has become part of the Union budget as part of the program to integrate what is one of the most important backbones of the Indian economy. Indian Railways being such is the result of the hardwork and investment of several generations of the people of the country, for which a large price has been paid by its people. Thus any decision on its present and its future should rightly lie in the hands of the people of the country. And yet, in the past couple of decades various governments have taken many steps to sell of its valuable asset of the people to greedy private sector hands, especially the profit making sectors. The article reminds us the even today, Indian Railways is responsible for the transportation of vital needs of the Indian economy, including food grains and coal and it still the main mode of transportation for its millions. And yet, through systematic wrecking of funding of essential sectors of the railways, they have become unsafe, dirty and unhygienic including the food that served on it. Over the decades, many corporations have come into being which are essentially privately held, and the model for the future is to parcel out other parts of the Indian Railways.
And yet, the publicly held part will be responsible for the least profitable and most vital sectors of the Indian Railways. The activities of these decades have led to the lowering of wages of people working for important sectors of the railways. Rail workers have stated in no unequivocal terms their opposition to the plans to sell of sectors. I would like to join the call made in the article that we must all unitedly oppose selling the assets to private profiteers.
All the above said, none of this will change until there is a deep going transformation of Indian society where there has been no fundamental change in property relations including after 1947. Relief can only occur when the sovereign power is transferred to the people from the minority of exploiters, so that a new economic order and a political system that guarantees the rights of all, and not just of the rich fat cats. Let us work together for such a new dispensation.
As predicted in the article on the Union Budget that was published in the 1-15 February issue of Mazdoor Ekta Lehar, the Finance Minister acted in the interests of the big capitalists while speaking a lot about addressing the problems of peasants and unemployed youth.
Selected anti-people measures in Budget 2018
Decision to merge three public sector insurance companies – National Insurance, United India Insurance and Oriental India Insurance. It will lead to retrenchment of large number of workers. It will create a monopoly which will control one-third of non-life insurance market (including auto, health and industrial insurance).
Introduction of fixed term employment in all sectors. This will badly affect the security of jobs and lead to intensified exploitation of workers and further violation of their rights.
Imposition of Social Welfare Surcharge of 10 percent on custom duty in place of Education Cess of 3 percent. All imported goods will become more expensive.
Further privatisation of public sector units: Divestment target has been raised to Rs. 80,000 crore. Strategic sale of many public sector units is planned, including Air India.
A large part of the Budget speech was devoted to rural India and farmers’ problems. The Finance Minister pretended to be fulfilling the demand of farmers to fix Minimum Support Price (MSP) for agricultural products at 50 percent more than their cost of production. However, farmers’ organisations have exposed this deceptive claim. Firstly, the government has adopted a narrow definition of the cost of production. Secondly, announcement of MSP is meaningless unless the government organizes guaranteed procurement at that price. For instance, farmers have had to sell soyabean at Rs. 2200 per quintal when the MSP is Rs 3050. They have had to sell maize at Rs. 900 per quintal when the MSP is Rs. 1450. For all the concern shown to rural India by the Modi government, the budget for the Ministry of Rural Development was increased by a mere 4 percent, not even enough to keep up with inflation.
As predicted in the MEL article, financial ratios show the highly parasitic nature of government finances. Nearly 39 percent of net tax revenue of the central government in 2018-19 will be spent on paying interest to the financial institutions. The working people will continue to be burdened with more indirect taxes, which will make up as much as half of the total tax collection. Indirect taxes are projected at Rs. 11,21,000 crore out of the gross tax collection of Rs 22,71,000 crore.
By exempting capital gains accrued until 31st January, 2018 from the new Long-Term Capital Gains Tax, the Finance Minister gave a massive gift to the richest capitalists in the country. Data show that additional wealth of Rs 40,00,000 crore accrued to the owners of capital due to an extremely rapid increase in share prices from 1st April, 2017, to 31st January, 2018. This massive amount of speculative profit will be tax-free.
The real class character of the Union Budget of 2018-19 is indeed the opposite of the impression that the Finance Minister tried to create with his speech.
Yours etc.,Pradip Kumar, Mumbai