Taking a dig at finance minister Nirmala Sitharaman, during a discussion on the general budget in the Rajya Sabha, for cuts in allocations made to the foreign ministry, Chidambaram wondered if “the finance minister is doing an Elon Musk on the external affairs ministry.” Musk, a billionaire, leads the US department of government efficiency (DOGE) created by President Donald Trump to cut government expenses.

The Congress leader said the income-tax cuts announced by the FM would not only benefit the middle-class, but also billionaires, noting the budget had nothing for the “bottom 50%” of India. Sitharaman was present in the House during Chidambaram’s address.

“The house should know that only 3.2 crore (30.2 million) people pay income tax. I have looked at Central Board of Direct Taxes statistics. About 80-85 lakh (8-8.5 million) will go out of the tax net. About 2.5 crore (20.5 million) will benefit, many of them rich and the richest. This includes about 262 people who file (returns for) more than ₹100 crore and 23 who file over ₹500 crore,” the Rajya Sabha member said.

Capital expenditure, critical grants and aids have cut to meet the fiscal-deficit target, Chidambaram said. “It’s not good economics to cut capital expenditure to meet fiscal targets.”

Referring to former PM Manmohan Singh, who died on December 26 last year, Chidambaram said when India faced a grave financial crisis in 1991, a “man entered the North Block, who had an economic philosophy and followed it up with policies.”

“I urge the FM to recapture the wisdom and farsightedness of Dr Manmohan Singh. Why have you not conferred the Bharat Ratna on him?” he asked.

Chidambaram challenged Sitharaman’s claim that ₹1 lakh crore of total tax savings will boost consumption and spur growth. “Will it not go into savings? Will it not go into paying old household debt? Will it not go into travel abroad, education abroad? How is the FM sure that it will go into domestic consumption?”

The Congress leader said ₹1 lakh crore is about 0.3% of India’s gross domestic product (GDP) of ₹324 lakh crore. “Will 0.3% boost the economy?” he asked. “After forgoing ₹1 lakh crore (in tax), how is the FM claiming that tax collection will grow at 11%? Purely magical.”

Accusing the FM of ignoring the poor, Chidambaram said that between 2012 and 2024, food inflation edged up 6.1% and health expenses increased 14%, while education inflation went up by 11%. “These have crippled households,” he said. Average rural per capita consumption expenditure stood at ₹4,226, while the figure for urban households was ₹6,996, he said.

“Instead of cutting income tax, the FM should have cut the Goods and Services Tax, which affects everybody. She should have cut taxes on petrol and diesel or increased the MNREGA wage. That would have benefited the thousands of poor. But she was focused on income tax and Delhi elections.”

Stating that unemployment was the “gravest of challenges”, Chidambaram said the budget had eight lines on expenditure on employment generation, five on production linked incentives (PLIs), one line on new employment generation programme and another on PM Employment Generation Programme. “What is the difference between new employment generation scheme and the PM employment generation scheme?” he asked.

Chidambaram said the PLI and Make in India programmes were a “spectacular failure” because India’s share of manufacturing in GDP had fallen from 15.07% in 2014 to 13.46% in 2019 and then to 12.93% in 2023.

The budget has made cruel cuts in Anushuchit Jatiya Yojana by ₹10,340 crore, post-matric scholarship for Scheduled Castes by ₹863 crore and in agriculture by ₹10,997 crore.

Quoting the Periodic Labour Force Survey PLFS, Chidambaram said while the unemployment rate was 3.2%, youth unemployment was 10.2% and unemployment among graduates was 13%. “So how is the overall unemployment rate 3.2%?” he wondered.

Hailing the Union Budget, ruling BJP leader Dinesh Sharma said the budget proposals for 2025-26 will help the country “emerge as an innovation hub” and are a part of the roadmap to make India a developed nation by 2047.

Shiv Sena leader Milind Deora supported the budget, saying its biggest focus area is to make India’s companies export-ready, while reducing the compliance burden. “This Budget, genuinely, in my parliamentary tenure, very rarely have I seen a budget where there is very little to add to,” Deora said.

In the Lok Sabha, Congress MP Manish Tewari compared the liberalisation of Indian economy in early 1990s by then finance minister Manmohan Singh with three other landmark plans—Roosevelt’s New Deal after the Great Recession; Japan’s economic plan after the atom bomb in Hiroshima and Nagasaki and Deng Ziao Ping’s economic plan to invite private capital.

“The NDA’s only big idea was Note-bandi (demonetisation) but all its objectives failed. Today there is ₹35.99 lakh crore cash in the economy. We told them not to give tax relief to industrialists, but to give money to common people. Now, after five years, they have given relief to common people after corporate tax relief failed to boost economy.”

Tewari also asked how will the private investors get funds if the government borrows so much money from the market. Accusing the Centre of changing the fiscal deficit parameters from absolute fiscal target to debt to GDP, he added: “There was one big idea in Economic Survey: the government needs to get out of the way out of people. But in the Budget, they failed to follow it.”