Mamata unhappy with Budget, but no fresh faceoff

KOLKATA: The Union Budget was frugal in its plans for Bengal and did not show the state a way out of its debt trap, but chief minister Mamata Banerjee on Friday opted for a firm nudge to the UPA government rather than another ballistic protest.
With the railway budget fireworks keeping Parliament and the strained ties between the Congress and the Trinamool Congress on a simmer, Mamata chose not to take her rebellion beyond the standoff with the government on passenger fare hikes and her demand for the dismissal of railway minister Dinesh Trivedi.
But the Trinamool Congress responded to the denial of a financial bailout by announcing four candidates for the state Rajya Sabha elections on March 30, leaving no room for the Congress. Bengal has five vacancies in the Upper House. The fifth will go to a Left Front candidate. The party also said it will ask its MPs to raise four issues of "public interest" in the House - the cut in EPF rates, the proposed cash subsidy transfer for LPG and kerosene in the Budget, funds for the food security bill and a bailout package for Bengal.
Since coming to power last May, the chief minister has sought a bailout from the UPA government to overcome the Rs 2 lakh crore debt burden she has inherited from the Left regime. Though she was upset with the Centre's silence on the rescheduling of debts, the Trinamool Congress appeared to be adopting a blow-hot-blow-cold strategy. So, even as Mamata instructed party MPs to take up the "public interest" issues in the House, Trinamool leader and state industries minister Partha Chattopadhyay said the Budget was "within tolerable limits".
He explained, "We have our fears on four issues of public interest, but the Budget as a whole is within tolerable limits. We are unhappy with the interest cut in the EPF rates that will affect the common man and also uncertain about the proposed cash subsidy transfer for LPG and kerosene. We expressed our fears during discussions in the Union Cabinet. Those fears remain. The government has to come clean on the mechanism of cash transfer. Otherwise, there is a fear that the government might leave the price to market forces, thus pushing up the LPG prices beyond limits. There is also no budgetary allocation to fund the proposed food security bill. Above all, the Centre didn't consider our long-standing demand for rescheduling of the debt that the new Bengal government inherited from the Left Front regime."
But the Trinamool Congress didn't step up the ante against the UPA beyond this, though the Bengal got nothing special from the Budget other than the proposed Rs 50 crore water treatment plant in Kolkata, and Rs 439 crore for funding the flood management programme at Kandi in Murshidabad, a Congress-dominated district.
However, there are areas where Bengal can get a larger share if the state government submits plans in time. The Backward Region Grants Fund (BRGF) is a case in point. The allocation has been increased from Rs 8,000 crore to Rs 12,040 crore for Bengal, Bihar and Orissa. The BRGF is a scheme where the state government and local bodies like panchayats and municipalities have the liberty to plan and implement projects unlike other purpose-specific central assistance projects, a Union finance ministry official said.
The fund is meant for 11 backward districts in Bengal - Bankura, Birbhum, Purulia, East Midnapore, West Midnapore, South 24-Parganas, Mushidabad, Malda, South Dinajpur, North Dinajpur and Jalpaiguri. State finance minister Amit Mitra pointed out the state was allotted Rs 8,720 crore as BRGF funds. Bihar received exactly the same amount in 2005-2006 when the fund was created.
But Trinamool leaders said the increased allocation was no compensation for the debt rescheduling Mamata has been asking for. Mitra also put across this view during his meeting with Prime Minister Manmohan Singh and the Union finance minister Pranab Mukherjee.
"An interest deferment for five months will help the state save Rs 9,000 crore, almost equal to the amount the Centre had promised to Mamata as grant-in-aid (Rs 9,240 crore). The ma-mati-manush government thus wants the Centre to grant some relief to the cash-strapped state government by way of a moratorium on the accumulated debt for which Mamata is not to blame," Mitra recently said.
Full Coverage on Budget 2012: Budget 2012, Budget News 2012