Chidambaram slams government over union budget, says Finance Minister walking on worn-out path, not willing to de-regulate

Addressing a press conference, former Finance Minister P Chidambaram said the economy will trudge along on the old path and deliver no more than the usual 6 or 6.5 per cent growth in 2025-26.

"This is a far cry from the 8 per cent growth rate that the CEA estimated in order to become a developed country. In our view, this is a government with no new ideas and no will to reach beyond its grasp," he said.

Recalling economic reforms carried out in 1991 and 2004, he said the Finance Minister is not keen to de-regulate.

Chief Economic Advisor V Anant Nageswaran on Friday held a press conference on the Economic Survey which was presented in Parliament.

Chidambaram said, "it is evident that neither the FM nor the PM care for the advice of the Chief Economic Adviser".

"He gave sensible advice in the Economic Survey. 'Get out of the way' was his call to the government. On the contrary, the Budget is full of new schemes and programmes, many of which are beyond the capacity of this government. I counted at least 15 new schemes or programmes and four new Funds. The FM is walking on the worn-out path. She is not willing to break free as we did in 1991 and 2004," the Congress leader said.

"She is not willing to de-regulate. She is not willing to get out of the way of the people, especially the entrepreneurs and the MSMEs and the start-ups. It is the bureaucracy that will be happy with this Budget. The strangle- hold of government on the activities of the people is getting tighter," he added.

Chidambaram said the takeaway from Budget 2025-26 is that the BJP is wooing the tax-paying middle class and the Bihar electorate. Bihar will go to the polls later this year.

"These announcements will be welcomed by the 3.2 crore tax paying middle class and the 7.65 crore voters of Bihar. For the rest of India, the Finance Minister had no more than soothing words, punctuated by the applause of BJP members led by the Prime Minister," he said.

Referring to the financial performance of the Modi government in 2024-25, Chidambaram said the revised revenue receipts are lower by Rs 41,240 crore and revised net tax receipts are lower by Rs 26,439 crore.

"On the expenditure side, total expenditure has been cut by Rs 1,04,025 crore and capital expenditure has been cut by Rs 92,682 crore. Of this cut, the sectors that have suffered most, and the amounts cut, are - Health: Rs 1,255 crore, Education: Rs 11,584 crore, Social Welfare: Rs 10,019 crore, Agriculture: Rs 10,992 crore, Rural Development: Rs 75,133 crore, Urban Development: Rs 18907 crore and Development of North East: Rs 1894 crore. The cruelest cuts were in allocations for the SC, ST, OBC and minorities," he said.

Chidambaram said there is nothing to cheer about the fact that the government has improved the fiscal deficit from the Budget Estimate of 4.9 per cent to the Revised Estimate of 4.8 per cent.

"It was achieved at a huge cost to the economy. Those who did not believe us when we said that the economy is slowing down will, I hope, believe us now. Those who did not believe us that that the capacity of the government to plan and implement schemes has diminished will, I hope, believe us now," he said.

"Capital expenditure for 2025-26 has been increased by Rs 1,02,661 crore but, having regard to the experience of 2024-25, I doubt the capacity of the government to achieve the target. I am glad, however, that the FM has shed her faith in astrologically determined numbers," he added.

Citing examples of POSHAN, Jal Jeevan Mission, NSAP, PMGSY, Crop Insurance Scheme, Urea Subsidy, and PM Garib Kalyan Anna Yojana, Chidambaram said the Budget Estimates and Revised Estimates for 2024-25 and the proposed Budget Estimates for 2025-26 clearly indicate that "the government has lost faith in these programmes announced with fanfare in the previous Budget speeches and the government's capacity has significantly diminished".

Chidambaram also alleged that Railways have been short-changed.

"If you examine the Railway specific heads of expenditure, you will find that BE 2024-25 was Rs 2,06,961 crore, RE 2024-25 is Rs 2,12,786 crore and BE 2025-26 is Rs 2,13,552 crore. Railways serve the overwhelming majority of the population. The increase of a paltry Rs 766 crore in 2025-26 will not even account for the inflation. The allocation will be less than last year's allocation," the senior Congress leader said.

"On the much-vaunted PLI schemes plus New Employment Generation Scheme plus Skill India programme that were promised to create thousands of jobs, the youth of this country have been cheated. Against a BE 2024-25 of Rs 26,018 crore, the actual expenditure will be only Rs 15,286 crore," he added. (ANI)