Former Finance Minister and Congress leader P Chidambaram opened the debate on the budget in the Upper House on Monday with scathing remarks on the state of affairs of the economy. He alleged that the suggestions of the Economic Survey have been ignored.
“I am afraid this budget is cautious, parsimonious, forgetful of the past year and this will vanish. Another minister and another deal is occupying the frontpages. The FM and the budget have vanished. This is a forgettable budget which has been prepared by a finance minister who forgot her promises made in this House last year,” Chidambaram said.
Chidambaram argued that the suggestions of Chief Economic Advisor V Anantha Nageswaran in the Economic Survey have been ignored. “The most charitable view is that they don’t care for the Chief Economic Advisor. The uncharitable view is that while the CEA wants to bring the government down to earth… the government and the ministers want to soar high and reach another planet as if we are not living on earth.”
He listed four challenges facing the economy: no increase in capital investment, high unemployment, slow growth rate and dismal pace of fiscal consolidation.
On capital investment, Chidambaram said the gross fixed capital formation is stuck at 30% of GDP for 12 years while the net FDI in 2024-25 has collapsed to less than .09 per cent. Private investment has been stagnant. Capex has been cut by Rs 1,44,376 Crore in 2025-26 and state capex reduced by Rs 1,19,041 Crore.
He also attacked the government on high unemployment, stating youth unemployment stands at 15% and less than 25% of the workforce has regular jobs. More people have been forced into agriculture and there are less than two crore factory jobs. “The PM internship scheme failed as out of 1.65 Lakh offers, only 33,000 accepted and 6,000 dropped out.“The third challenge is slow growth rate. Nominal GDP growth fell from 12% in 2023-24 to 9.8% in 2024-25 and further to 8% in 2025-26,” Chidambaram said.
The Congress leader also expressed concern over slow fiscal consolidation, saying fiscal deficit and the debt to GDP ratio figures are not satisfactory. With fiscal deficit at 4.4% in 2025-26 and revenue deficit stuck at 1.5%, the FRBM target of 3% will only be achieved in 12 years, he said, adding that these “baby steps” are not enough.
Chidambaram also slammed the government on ministries failing to spend the funds allocated to them in the last budget and the sizable cut in the budget allocations to agriculture, rural development and Jal Shakti ministries in this year’s budget.
“I am looking for (Agriculture and Rural Development Minister) Shivraj Singh Chouhan and (Jal Shakti Minister) CR Patil. I am amazed that there has been a cut of Rs 60,000 Crore in the budget for agriculture and rural development. Agriculture has been cut by Rs 6,985 Cr and rural development by Rs 53,067 Cr. Rural areas do not require any development?” he said.
He alleged that the Jal Shakti ministry spent only Rs 17,000 Cr of the Rs 67,000 Cr allocated to it last year. “What is going on? Why is there a budget? People are dying because of contaminated water in Indore,” he said.
He further emphasized that the defence expenditure has been reduced to “an all-time low” of 1.6% of GDP and 11.4% of total expenditure. He said scientific departments, urban development and social welfare have failed to spend the funds allocated and this year there has been a cut of Rs 9,999 Cr for social welfare.
“What are the ministers doing? Why are they not fulfilling the programs and spending the money?” he said.
Taking digs at Sitharaman, he said, “I must compliment the finance minister. She has found the formula to mesmerize one half of the House. She throws schemes, funds, missions, committees. I counted 24…”
BJP leader Arun Singh praised the prime minister and the government for a budget that “strengthens the aspirations of the people and helps in moving from Sankalp to Siddhi (pledge to achievement)”. He emphasized that the capital expenditure allocation today at Rs 12. 5 Lakh Crore is way above Rs 2.50 Lakh Crore. He congratulated the finance minister for fixing the target of fiscal deficit at 4.3%.
Singh compared India’s debt-to-GDP ratio with other countries and said at 55.6%, it is lower than many countries. “Due to this, the confidence of the tax payer in Prime Minister Modi is increasing,” he said, adding that the tax-payer base and number of demat accounts has gone up.
The BJP MP also mentioned the reduction in current account deficit, increase in export of mobiles, more private investment in defence, high forex, low inflation, more funds G Ram G scheme and railways.
“We win elections as benefits directly reach the beneficiaries. People see Modi as their messiah,” he said.
TMC member Sushmita Dev maintained that she found “jarring” the issues on which the budget is silent. She also wondered about the authenticity of the data cited by the government in the absence of a census since 2011.
“The finance minister has presented nine budgets, the same as P Chidambaram. However, six of her budgets have been presented without the Census. Raja does not know the number of his praja. Why did you not conduct the census?” she said.
Dev also questioned the government claim of uplifting 25 crore people from poverty, alleging that one of the criteria set by Niti Aayog about rising from poverty is having a Jan Dhan account. She said 23% of the Jan Dhan accounts are inactive.
The TMC leader claimed that West Bengal has performed well despite discrimination against it by the Centre. “Unemployment has come down by 40% in West Bengal,” she said.
Dev alleged that “backdoor NRC is being done through SIR” and maintained it will be backfire for the BJP. “How many infiltrators have you caught?” she asked.
P Wilson (DMK) said the government is clueless about the debt trap. He also brought up the India-US trade deal, saying “Capitol Hill is rejoicing while there is no clarification from Raisina Hill about the deal. There is abject surrender to the US,” he said, expressing concern over “weaponization of tariffs”.
“The ferocious lion of Make in India has become a pet cat of US,” he said.
Sitharaman countered Wilson’s charge that the budget has nothing for Tamil Nadu. “This is absolutely incorrect,” she said, adding that the Rare Earth corridor, girls hostel in every district, sops for fishermen and coconut farmers as well as the allied health program will benefit the state.
Raghav Chadda (AAP) enumerated some of the good points of the budget like increase in STT, increase in capex, restraint on budget allocations for election bound states but rued that there is no change in tax slabs, no relief for the middle class, less allocation for education and health. He suggested that there should be a wage indexation formula.
Sanjay Jha (JDU) praised the budget as one that marks the start of a new era in economic sector. “This budget clearly shows that the focus of this government is long term economic stability and development. After struggling with economic instability, energy deficit and economic pressures, the government is now giving priority to creation of new capabilities and productive investment,” he said, adding that the budget shows fiscal discipline and robust planning.
