In New Delhi, on February 12, Finance Minister Nirmala Sitharaman asserted that India is experiencing robust growth with low unemployment, dismissing concerns about "jobless growth" as a relic of the previous government.
In response to the debate on the 2026-27 Union Budget, she stated that the middle class is expanding, not shrinking, and emphasized that the higher taxes paid by individuals compared to corporations do not mean they are being burdened.
She argued that the measures outlined in the budget demonstrate the government's commitment to building a resilient and self-reliant India.
Regarding criticism of reduced funding for welfare schemes, Sitharaman clarified that the Centre's funds are not a "free pool" but rather hard-earned contributions from all Indian citizens, which will not be misused.
She explained that the funds are released only when needed, and not simply to increase spending.
"We now have complete transparency in the government's spending process," she stated.
She also noted that inflation in India is lower than in many other emerging economies.
"I want to highlight that inflation is at a historic low, even though growth remains high. There is no inflation crisis in India today. Inflation has been effectively controlled and stabilized due to the government's measures," she said.
"The idea of 'growth without jobs' was a characteristic of the previous government, not now," she added.
In response to opposition parties' claims that middle-class individuals are paying higher taxes, the finance minister countered, "The conclusion that the middle class is being squeezed due to the difference in tax collection between individuals and corporations is fundamentally incorrect. There is no evidence to support this claim."
Instead, she argued that there is more evidence of the middle class expanding and becoming more formalized, driven by the economic reforms implemented over the past ten years.
"High personal income tax collection does not necessarily mean the middle class is being negatively impacted," she said, adding that the economy is no longer limited to a narrow elite, and the middle class is expanding.
Therefore, she concluded, the middle class cannot be suppressed when the tax base is expanding and the tax net is also widening, and people are voluntarily paying taxes.
Sitharaman stated that between 2013-14 and 2024-25, the number of taxpayers increased from 5.26 crore to 12.13 crore. Within the last 11 years, the number of income-tax payers has more than doubled, which represents the largest structural expansion of the middle class in the country.
She accused the opposition of misleading the House by claiming that the government is cutting funding for welfare schemes to maintain a low fiscal deficit.
She explained that in the past, success was measured by how much was allocated, regardless of whether it was actually spent or not. However, this government now has "complete visibility" on where the money is allocated and spent.
Therefore, she clarified that the money is released only when it is required, and when it is utilized, adding that the government ensures that the money is released only when the ground-level work demands.
"I want to categorically state that there is no denial or stoppage of funds to any state or any scheme," the finance minister said.
She urged members to encourage their state governments to participate in the central schemes.
She also criticized the Congress, alleging that it is making false claims about rising debt and demanding that they "release more funds to the states."
"The government cannot borrow excessively. This is a principle that guides us. The Congress is obsessed with spending, but we say that we will give you money, but you have to give us results. The Congress is worried about expenditure, while we are concerned with the outcome," she said.
Sitharaman stated that the government has directly transferred Rs 48 lakh crore into the bank accounts of beneficiaries under various welfare schemes, saving an estimated Rs 4.31 lakh crore from being misused.
She also highlighted that the country's labor market is undergoing a structural transformation, noting that the unemployment rate was 5.6% in 2017-18, compared to 3.2% in 2023-24.
In fact, she emphasized, the unemployment rate has decreased.
Sitharaman criticized the TMC-led West Bengal government, alleging that it does not implement welfare schemes financed by the Centre, depriving the state's citizens of the benefits.
The finance minister also addressed the Congress and DMK for their concerns that no significant announcements have been made for the upcoming elections in Tamil Nadu, as she outlined various budget proposals for the state.
During the reply, Leader of the Opposition Mallikarjun Kharge stated that Sitharaman mentioned that the Tamil Nadu government has committed nearly Rs 4 lakh crore in debt.
"I would like to ask if the minister is referring to the Tamil Nadu budget or the Indian government budget," he said, adding that because the Tamil Nadu elections are approaching, she is mentioning things that have nothing to do with this House.
"This is not fair. I condemn this," Kharge said.
Responding to former finance minister P Chidambaram's remarks, describing the Budget as "forgettable," Sitharaman said, "There was a comment suggesting that the budget is forgetful of the past."
"Budgets are never forgetful of the past... if there is a glorious past, cherish it forever. Remember it every time. But if it is a tarnished past, I would like to learn from that past and not make mistakes again."
"So, we do not forget. This budget is not forgetful of the past. It remembers the fragile five days, the double-digit inflation days, the policy paralysis, and the scam-filled days. It remembers that banks were forced to lend just with a phone call without doing any KYC."
"Deficits were kept high, and spending on capital expenditure was reduced," she added.
Chidambaram had said, "This is a forgettable budget. A forgettable budget, which has been prepared by a finance minister, who forgot her promises made in this House last year."
