Mr Chidambaram, your predecessor in the north block, says that he is very happy that you were reading his and his party’s manifesto where you picked up the internship issue. He says the removal of the angel tax was also their idea in the manifesto. Were some efforts made to look at other people’s manifestos, other parties’ manifestos, before the BJP finalised its policy?
Nirmala Sitharaman: I would want to first of all remind you that it was the Congress Party that brought in the angel tax in the first place in 2012 and they were there in power for two years after that. This removal which we are doing now, they should have removed it much before they went away. So, it is very nice for the Congress Party to remind me saying, we said that this should be removed. There was a tweet saying it is an exploitative tax. It should be removed. In 10 years, we have tried eliminating all kinds of poisonous weeds, which were part of this.
It took you 10 years?
Nirmala Sitharaman: Yes, systematically we have removed the startups from it. Last year, we brought in an amendment to make sure that parity is brought between the way the domestic investors and NRI are treated. We tried making it less toxic if I may use that word. Then, after a lot of discussions, since we understood in the sense that this serves no additional purposes if black money has to be curtailed, for which it was brought in, we have the PMLA, we have the Black Money Act, and particularly because Black Money Act post-2015 brought in by this government are all there, we will use them. Therefore, we have removed this. So let me ask you, on your internship scheme, which also they say that was their original idea, you said one crore people will be given these internships in 500 odd companies. Now, if I do the math, over five years, it means 20,000 people in every one of the 500 companies if all 500 are doing at the same level, means 4,000 of these interns will go per company. Do you think companies have the kind of wherewithal to have internships for 4,000 within their existing setups every single year?
Nirmala Sitharaman: We are paying for them. The government is giving Rs 5,000 per month for the 12 months, and Rs 6,000 at the beginning as a one-time payment. Therefore, the payment is coming from us. I am not saying, oh, it is an easy adjustment. Companies will be nudged to do this because it is these companies that often tell us that they are not able to get employable skilled, industry-ready, qualified people. Through this exercise, we hope the companies can see that this internship gives them an understanding of that kind of requirement and, therefore, they will be better ready for industry. 4,000 people in a building?
Nirmala Sitharaman: No, a company is not just one building. There are several units, branches of a company. They have different establishments for different purposes. So, I do not think it is that simple. But then the question is, have not we heard in the recent past, one top company’s CEO saying 45,000 jobs are lying vacant because they are not able to get the right people? And this company –if I can take the name – is L&T. There are 45,000 jobs they are not able to fill for lack of the right kind of people. I would not blame the company. Maybe that is a reality. Therefore, what we need to do is to give the young people that exposure. One year on the shop floor as an intern, when he gets out and puts that in a CV, there can be many other companies who look for such people to recruit. So, I expect a lot of positivity from the scheme. And companies will realize that that is eventually going to give them a bankable pool of people with that kind of exposure. So, companies will come out favourably.
The Opposition says jobs are what the youth of India want and what you are giving them is a temporary placement to buy peace.
Nirmala Sitharaman: And that is why they said it is a right. Internship is a right. We will have to give it. They said it in their manifesto. So, if you think it is not a placement, why did you have to give it as a right to them? So, you were cheating. Were you? Were you not? Congress Party, you were cheating people were you misleading them, right?
But then the comeback…
Nirmala Sitharaman: What we are giving is a part of five sets of things we want to give the youth. Three of them are going towards job creation, freshers, entering the job scene for a second time and helping both the employee and the employer. Three out of five scheme packages are for jobs.
So, you do recognise that jobs are a problem. You do recognise that during the elections, unemployment was the big issue, about which the BJP was in denial, and it is now the central theme of your Budget?
Nirmala Sitharaman: You may want to put it in any fashion. One year of giving appointment letters by the prime minister for central government jobs, one year from 2022 November to 2023 November, PM himself gave appointment letters in Rojgar Melas. Is that not giving jobs? The RBI study which has been spoken about, says that 4.7 crore jobs were given in just one year, 2023-2024. If that was the situation and that report is challenged by other reports from Citi Bank that have come in and people have questioned these numbers. My question to you is, when will we have authenticated data that we can rely on?
Nirmala Sitharaman: The periodic labour force data has started coming from the government. I think the last two years we are regularly bringing this and it gives a clear picture of jobs and also the EPA for data which is available, again which is a very reliable source from the job place itself where the worker goes. So, there are data. There can be more, no doubt.
But it is not as if there is no data at all. Every time we look at formal jobs, let us also remember it is in this country in the last five years because of the rapid rate at which digitalisation has happened, there is a higher level of formalisation. Many workers from the informal sector are getting into the formal as well. Lots of changes are happening; therefore, data come from different sources, from the banks.
When we talk about that, immediately you have a mocking tone coming from the Congress saying, oh, you want everybody to make pakodas. No, every self-employed man does it with pride. So, when Mudra loan is given, when PM Svanidhi loan is given, when PM Vishwakarma helps self-employed people who are working with their hands with minor tools in their hands, these are all aimed at self-employment. They have to be counted gradually. So, jobs are happening, but…
But just not in the formal sector.
Nirmala Sitharaman: Also. in the formal sector, but many out there in the informal sector. So, we need to have a way to count them. Now, we get the figures from banks as to how many people have taken this loan. So, they are running their own business. Maybe one fellow to help them and so on. There are many different ways, start-ups, unicorns. They are all self-employed. Are they not employing people? Are we counting them or not?
So, let me you, not only Mr Chidambaram, Mr Kartik Chidambaram also has a point of view. He says your long-term capital gains tax without the indexation is an inheritance tax. If that is true, then Sam Pitroda, who you and your party opposed so much, that tax idea has also been adopted into this. Is Kartik Chidambaram right?
Nirmala Sitharaman: How will it be inheritance tax if it is a property that you bought and you are selling it? If you bought it, there can be a rare occasion for somebody who inherited a property and who is selling it and therefore you can count it as an inheritance tax but most people spend their own money, buy a property and also sell it. Is that inheritance? How will that get classified under it?
Yes, but earlier indexation had a cut-off date of 2001. So, many people, their parents also give them homes.
Nirmala Sitharaman: Okay, you want to go on proving the Congress right, please try. But I will not concede on this because we brought it in from the point of view of simplifying and not for revenue considerations. Now, when we tax people who are earning a high amount out of capital gains, having given exemption for Rs 1.25 lakh for lower level investments, you think that we are doing a wrong thing, then why was inheritance tax and redistribution tax actively campaigned for by the Congress Party?
You want the big money earners also to pay for the country. And when we do it…, but when we do it in this way, you want to accuse us of this is inheritance tax. Amazing. Everything will be in their terminology and they will constantly say either it is my idea or it is wrong to do it, but not give the credit to Prime Minister Modi because no, you do not like him.
As far as reforms are concerned, you are shying away from disinvestments. Rs 60,000 crore was your target previously. You brought it down to Rs 50,000 crore and even that target hasn’t been achieved. Only 50% has been achieved at this point. Are we losing focus on reforms?
Nirmala Sitharaman: No. So many things about reforms, land reforms have all been defined in this budget. Disinvestment is not a process for which I have got Cabinet approval saying I want to sell this today. I will sell it. It requires a lot of preparatory work. Many of our PSUs are now being professionally run and their valuations are all going up. But I will have to find my best time to disinvest them and that best time depends on so many different factors. The company’s readiness to meet market challenges is not a simple task. They consume time, but we will honour the cabinet approval decisions.
You have cut the tax rates for foreign companies investing in India from 40% to 35%. Is this because has been falling and the percentage of the GDP is an area of worry?
Nirmala Sitharaman: It was not aimed at that, nor is it expecting a huge flow because of that. FDI comes into this country in various forms. Different sources invest in India and we have a policy favouring FDI because we think India is the place for manufacturing now and investment should happen in this country. Therefore, the FDI policy has been bettered every year and improved upon. We are now looking at investments in labour-intensive sectors as well.
But FDI stood at almost $14.5 billion during April ‘23 to February 24. It is down to that level from $26.7 billion – a sharp fall in FDI.
Nirmala Sitharaman: FDI is also dependent on many other external considerations, it does not move just on India’s policy or India’s situation; the global situation has an impact.
But we wanted to be the alternative to China. How far are we from that target?
Nirmala Sitharaman: Yes, we are still working towards it, that is why you have this growth. Do you think this growth can be achieved otherwise?
There is growth in the economy but no growth in the FDI. How will we become an alternative to China unless FDI increases?
Nirmala Sitharaman: Today, domestic investments are also happening in a big way and we want to recognise that. You quote me the FDI numbers, I also tell you about the investments within the country, and retail participation in the stock market. Won’t these factors promote investment within this country? There is the JPMorgan index, through which a natural flow of investment funds is happening like clockwork. These are also important developments that we need to take into consideration.
Let me ask you about subsidies. Subsidies as a percentage of GDP have been coming down since 2020, the peak COVID period, to 1.31% of the GDP in 2024-25. Food and fertiliser subsidies have gone down while petroleum subsidies have gone up. Is this a policy shift because food and fertilisers often were the larger part of the subsidies? Are we back to subsidising petroleum?
Nirmala Sitharaman: Food subsidy is in so many different ways, right? MSP, free food grains, they are all happening. So, there is no way we are cutting down on that. There can be small changes here or there, but the main schemes are all intact. We are still giving farmers a subsidy for fertilizers. We have not reduced that. But that rise in the fertilizer price, which happened post-2020, is not the rise now. So, we do not need to pay that much for a price which has come down.
So, you are making a saving there?
Nirmala Sitharaman: Yes.
So, it is not the quantum of subsidy, it is the value at which imports were being done?
Nirmala Sitharaman: Imports were happening. There was a time when it went skyrocketing. I would have compared it for the per bag price which a farmer pays and the actual per bag cost with which we are importing. These differences have to be taken on board before thinking that every reduction means the end beneficiary is paying more from his pocket and a subsidy has been cut.
Rahul Gandhi is using his offices to get a lot of sympathy from farmers and today he met in Parliament farmer leaders to discuss legal guarantees for MSP. Do you think once again the farmers’ issue is going to put the BJP on the back foot?
Nirmala Sitharaman: No. Take for example, the MS Swaminathan report. When was it submitted? During that period, who was in government? And how long did they sit over it? Today they are showing sympathy for farmers. Today they are saying, are you giving as per MS Swaminathan report? I want to ask the Congress, is there no end to your hypocrisy? This MS Swaminathan report was with you in your UPA days. Are you sincerely wanting farmers to be better off? Why could you not give it at that time? You sat over that report.
But that was then, this is now.
Nirmala Sitharaman: You can always say all this and you can always say I am asking on behalf of the people. Please ask the Congress Party this question. Now you are standing next to the farmers and asking this question. Very well, do it. You are in the opposition. But I want to ask them and I wish media asks them, MS Swaminathan report was very much in their hands for more than a couple of years. No sympathy at that time to the farmers.
You explain to the people that emergency was brought by them, yet their narrative is that BJP wants 400 seats because they want to change the constitution, that narrative gained some momentum on the ground.
Nirmala Sitharaman: So, what did the media do about it?
It is not my job. You are fighting elections with the opposition parties. How is the media supposed to get into it?
Nirmala Sitharaman: Of course, the media cannot do anything. I agree.
So, on the farmers issue…
Nirmala Sitharaman: I am giving you an answer on the farmers’ issue, you come back to me to ask the same question again and again. Please do ask the Congress Party. MS Swaminathan is being raised by the Congress Party members even today. Look at the temerity. That report was submitted to their government. They have not done a damn about it then. But today, oh, you are not giving MS Swaminathan. Amazing audacity, I would say.
One very popular scheme that was promised was the Ayushman Bharat coverage to people above the age of 70 years. The provision that has been made by you in the budget has only been revised by about Rs 500 crore for the health department. Do you think you will be able to roll out this scheme because that will require Rs 4,000-5,000 crore. Do you think that is going to be rolled out in this year and the promise will be kept up?
Nirmala Sitharaman: I will have to talk it out with the health ministry to see how they are going to take it up.
So, you have not provisioned it…
Nirmala Sitharaman: Look at MGNREGA. It is demand-based. As and when the demand comes from the department, we certainly give it. It is not as if I parked the funds ready sitting there. Even at this stage, as the year passes by, we will add. Nobody is denied money once it is made in the budget. The moment the department places that, we will always…
So, you will divert money from somewhere to somewhere else?
Nirmala Sitharaman: It is not diversion. We have made a provision. We will give it, or else I will go to the supplementary demand for grants during the next session of parliament and take it from there.
So, how would you explain the message of this budget, to the people of India, the youth of India, and India Inc, in terms of growth?
Nirmala Sitharaman: No, very clearly, for three groups, industry…?
Youth and the common man on the road.
Nirmala Sitharaman: Youth, the kind of jobs and the skilling and the internships that we have offered for which the government has shown an outlay per person is something which we are serious about and we will do it to benefit the 4.1 crore that we have spoken about.
Among the youth, common people are also there. Families are also common people’s families whose youth benefit from it. We are giving affordable housing. We are building three crore more houses under PM Awas Yojana. PM Gram Sadak Yojana will link better Gaon. Tribal people in 63,000 tribal villages will be getting basic amenities for them. They are also common people. We are reaching out to them. We are giving PM Adivasi Unnat Gram Yojana to them.
Common people have so many different schemes through which we are reaching. What is Lakhpati Didi? What is Drone Didi? They are all people in the villages, women in the villages. Three lakh crore for women, women-led development. Poshan Abhiyaan for ordinary women in the villages. These are all schemes that are benefiting the common man, are they not? And look at the student loan which we offered, saying 10 lakh can be taken at a discounted subsidised rate for your children who want to go for higher education in Indian universities.
Well, you are extremely feisty when you defend your turf and you are extremely aggressive and women being aggressive, is great because you cannot do your job unless you are aggressive. People walk all over you. I also want to test your sense of humour. And there is this meme. Some pictures of you are floating around. Have you seen this one? And this one carries a caption. Tax nahi dena hai, toh kam kamao (Don’t want to pay tax? Earn less). What would Nirmala Sitharaman today say about this?
Nirmala Sitharaman: I will just laugh at it because it was a halwa ceremony and there was a situation that was probably last year or the year before. That is it and somebody took a picture and it is out. People are using it to entertain themselves.
Do you find humour when you see these memes? Do you laugh over it or does it bother you?
Nirmala Sitharaman: No, I laugh at many of them. But when it is accompanied with toxic language, sometimes I wonder, where does this toxicity come from? Everybody does their bit. I am doing my bit. But never mind. If it entertains people, please let it go on.