New Delhi: Finance Minister P Chidambaram answered questions about Budget 2013 using Google Hangout, a multi-person online video chat, at 8:00 pm on Monday. Chidambaram joined the camp of other personalities like Barack Obama to use Google Hangout to reach out to people.
During the social media chat, the Finance Minister pointed out that with tough economic conditions and social obligation there was limited space to dole out a Budget which would have been liked by all. This Budget mainly focused on three aspects - fiscal consolidation, attracting more investment to deal with the current account deficit and to restart the growth engine especially in manufacturing sector. During the session, he pointed out that he is confident that India will get to 6 percent growth in FY14 and 7 percent in FY15.
People from different walks of life were part of interaction people like Anand Mahindra, CMD, M&M, Manish Chokhani, MD and CEO of Axis Capital, Jahangir Aziz, senior Asia economist and India chief economist JP Morgan, Amit Singhal senior vice-president at Google Inc, Reechal Vardhan, student, IIM Bangalore and Kala Kudwa, a housewife.
During the social media chat, the FM said with tough economic conditions, there was limited space to dole out a Budget that would have been liked by all.
The session was moderated by CNBC-TV18's Senthil Chengalvarayan.
Here is an edited transcript.
Senthil Chengalvarayan: It has been years since I looked forward to a Budget with as much anticipation as I did for this Budget. We were really clinging to our investment grade rating and the slightest misstep from the finance minister on the fiscal deficit would have seen a downgrade of the country to junk status. What would have that meant for ordinary Indians? Interest rates would have gone up, jobs would have become scarce, the rupee would have fallen.
In short, we would have been in a downward spiral from thereon. The Budget has averted that. It laid down a roadmap to put in the countries accounts in order. On back of my mind, I was hoping for the shades of the dream Budget that Chidambaram presented in 1997, a Budget that would have immediately reignited the animal spirits of the economy and got India back in investment and job creation mode. That unfortunately is the weight of expectations that you have to bear, you are like Dhoni going out to bat and every time people expecting you not just to salvage a draw for us but to put us on to a winning track.
What is your opening remark?
Chidambaram: One has to look at what was done in the light of objectives that we set for ourselves. One plays according to the pitch and weather conditions. The world economy is constrained and India's economy is also constrained. Therefore, there is only so much economic space.
Given the restricted economic space, I had set for myself three objectives, apart from some smaller objectives. First, we must be on the fiscal consolidation path. Second, we must attract investment to deal with the current account deficit and thirdly, we must restart the growth engine especially in manufacturing sector.
One would have liked to do many more things but there is no space for that. There are other objectives not purely economic objectives but socio-economic objectives and social objectives. We need to look after the schedule cast, schedule tribes, minorities, youth, the other backward classes and therefore given the restricted economic space we have done what could be done. If we get more space after the first or second quarter of 2013-2014, certainly we can do more but that is for the future. For the time being, we have done all that could be done given the space that was available to us.
Chengalvarayan: What has the Budget meant for you? What has it meant for the youth of this country, has it met your aspirations, what would you like to ask the Finance Minister?
Vardhan: I feel that the Rs 1000-crore Nirbhaya fund and the all women's bank that was announced in the Budget have a potential to be game changing initiatives in the next few years. Can you specify which specific programs these funds will cater to regarding women safety and empowerment?
Chidambaram: These are ideas which have to be fleshed out. These are ideas that emerge in discussions with the Prime Minister and a close circle of advisors. This is not shared with too many people before it is announced.
We have put away a Rs 1000 crore and we will now work with other ministries and government departments which are concerned about women and women's welfare, we will work with NGO's and then we will try to find how this money can be used in order to enhance the security for women and the empowerment of women who enter public places, public spaces; I think that is important, that is the purpose of this fund.
I have done a lot of homework on women's bank. We plan to start with headquarters and at least six branches in the six regions of India. All the proprietary work should be done by October and the bank should be inaugurated by November. However, that is entirely within the ministry of finance and the Reserve Bank of India (RBI). So, things are under my control and the bank should start by November.
Many of the other ideas too are ideas which are announced in the Budget which have to be fleshed out. I have already sent a note to the Prime Minister requesting him to begin to take crucial inter-ministerial meetings in some areas. In some other areas the Cabinet secretary will take a meeting of the secretaries and in other areas which fall within the ministry of finance, I will begin to take meetings. So, we want to do all the proprietary work in March and early April so that implementation begins in right earnest by April.