New Delhi, Feb 10 (PTI) Congress leader P Chidambaram on Monday said the Union Budget 2025-26 is a "politically-driven budget" with Delhi elections in mind as it ignored the poor and bottom half of the population.

Initiating a discussion on Union Budget 2025-26 in Rajya Sabha, Chidambaram questioned Finance Minister Nirmala Sitharaman for improving fiscal deficit by cutting the Centre's capital expenditure and grants-in-aid to states and termed it as bad economics.

"There ought to be a philosophy behind the Budget, but I cannot find one in this Budget. I shall not attempt to do so because after going through the Budget speech and Budget numbers, I believe there is no philosophy behind the Budget," he said.

Chidambaram further said, "It is obvious that the budget was politically driven, I shall not elaborate upon that but I congratulate the finance minister for achieving one of her objectives a couple of days ago." He was referring to the BJP's win in the Delhi assembly elections.

The former finance minister also stated that the MGNREGA daily wage could have been increased "because the poorest are the ones who are going for MGNREGA work" and also the statutory minimum wage across the board under the Minimum Wages Act, could have been raised and that could have benefitted thousands and thousands of labourers.

"She (Sitharaman) did nothing. But, she was focussed on the Income Tax and she was focussed on the Delhi elections," Chidambaram asserted.

Referring to the Income Tax relief provided in the Budget, he said, "She remembered the middle class but what about the section of people she has forgotten?" Citing government data, Chidambaram said between 2012 and 2024, in the 12-year period, food inflation was 6.18 per cent, education inflation was 11 per cent, healthcare inflation was 14 per cent.

"These have crippled Indian households. Household savings have fallen from 25.2 per cent to 18.4 per cent," he said, adding as per household consumption survey in 2023, the average monthly per capita expenditure of a rural family is only Rs 4,226 and in urban areas it is only Rs 6,996.

"What has this budget done for the average Indian household in the bottom 50 per cent and the bottom 25 per cent? Nothing? What relief has the finance minister given them?" Chidambaram asked.

He also said the wage of a salaried male worker has fallen in the last seven years from Rs 12,665 per month to Rs 11,858 per month. The wage of a self-employed male worker has fallen from Rs 9,454 per month to Rs 8,591 per month.

"What is the position? The position is incomes are falling, wages are falling, government expenditures are not keeping pace with the promises, household net savings have fallen. Household debt has risen. This is the plight of the bottom 50 per cent of India. There is nothing in this Budget for the bottom 50 per cent," Chidambaram said.

Stressing that the Rajya Sabha cannot be divided into one half speaking for the top 50 per cent and one half speaking for the bottom 50 per cent, he said, "I am quite happy to speak for the bottom 50 per cent but I want the treasury benches also to impress upon their minister to speak for the bottom 50 per cent of India." He also said the raising of threshold for income tax relief from Rs 7 lakh to Rs 12 lakh applies to "all taxpayers right up to the highest taxpayer" and about 80-85 lakh taxpayers will go out from the tax net and 2.5 crore will benefit citing CBDT data.

"This 2.5 crore not only includes the middle class but also (includes) 2.27 lakh people who returned a total income of more than Rs 1 crore; 262 people who returned a total income of over Rs 100 crore; 23 persons who returned a total income of (Rs) 500 crore," he said.

So, Chidambaram said, "This is not just benefiting the middle class alone -- which is welcome -- but also the richest of the rich." He also questioned after foregoing Rs 1 lakh crore in this budget, how does the FM claim that the net tax revenues by the Centre will grow by the same 11 per cent.

"This is pure magic, not mathematics," he said, adding the Rs 1 lakh crore will not go solely into consumption of domestic goods and services but will also go in repaying old household debts, travel abroad and education.

The senior Congress leader also alleged that the government's various schemes, including the PLI and Make in India, are "spectacular" failures and these have not been able to meet targets and not been able to generate employment.

He added that at present "the gravest challenge facing the country is unemployment".

Chidambaram also accused the FM of cutting capital expenditure to improve the fiscal deficit from a target of 4.9 per cent to 4.8 per cent.

"But how did she achieve this 4.8 per cent? She cut capital expenditure by the Central government by Rs 92,682 crore. Not revenue expenditure... She cut the grants-in-aid to states for creating capital assets, another form of capital expenditure, by Rs 90.887 crore," he said.

He further said, "So total cut in capital expenditure by Centre and the states in the current year will be Rs 1,83,569 crore. By cutting capital expenditure by such a humongous amount she saved on the fiscal deficit Rs 43,785 crore," he said, adding that cutting capital expenditure could have been understood had the saving of the fiscal deficit been equally big.

"But after cutting Rs 1,83,000-odd crore, she saved about Rs 44,000 crore. Is it a good policy? I don't know, Is it good economics? I say no. It is not good economics," Chidambaram asserted. PTI RKL MR