Budget 2024: An economic policy document for rescuing the government
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Union Finance Minister Nirmala Sitharaman presented the seventh budget, the shortest of all aside from the Interim budget ahead of the polls on February 1. Assessing her past budget speeches show that they have two faces: One, the praise of Modi as was heard in the interim budget. Some observe she made a political speech in the Parliament keeping to the convention of the budget speech. The Second, it is a rhetoric far removed from the present realities of India. Her maiden budget speech of 2019, presented in over two and a quarter hours, had preface offering a roadmap for quarter of century and the speech delivered in 2022 will also be included in this category. One might find it hard not to laugh taking a glance at them today: inquiring as to what happened to the decision to introduce digital currency, special tax to digital assets, it will reveal ‘Nirmala magic’ of wrapping the ‘falsehoods’ in red silk. However, it cannot be termed so this time; the changes are apparent. The third Modi government's first full budget was completely different in content and presentation from the previous ones.
The change in approach to the budget cannot be considered a positive political transformation. A primary assessment shows that the BJP and the central government are forced to adopt the approach in the new political scenario. The BJP came to power but the party and Sangh Privar are not happy with the results, after they had gone to polls with the claim of winning 400 seats; Political and administrative stability is essential for the Modi government as it is riding on the benevolence of Andhra Chief Minister Chandrababu Naidu's Telugu Desam Party (TDP) and Bihar's ruling Nitish Kumar's Janata Dal United. One would doubt if the budget was prepared keeping in mind the situation of having to humour both parties. Though Andra Pradesh was not granted its demand of a special status, the budget in effect contains promises equivalent to its demand. A special financial package of Rs 15,000 crore has been earmarked for Andhra; also, many other schemes have been declared to increase investment in the state. Bihar is no different. In addition to the development of domestic facilities worth a quarter of a lakh crore, sufficient medical colleges and airports have been announced to please Nitish. Apart from this, a special flood relief fund has also been allocated to these two states. These can be seen as rescue packages for propping up the government. Indirect budget intervention can also be seen in Maharashtra and Haryana where assembly elections are due later this year. The BJP suffered a major setback from the agricultural areas of these states in the Lok Sabha elections. The announcements of 1.52 lakh crores for the agricultural community suggest that the eyes are on the state elections. However, these declarations cannot be limited to mere political agendas. These announcements stem from desperate efforts to stabilize the broader economy, thus help bringing the country's fiscal deficit down to four and a half percent of GDP. Although measures such as cut in corporate tax should be put in the category of Modi government’s continuing service to corporates, they will be useful for the prosperity of broader economy. No need of describing who will be the beneficiaries of these schemes. However, inclusion of middle class into housing schemes is a remarkable change. Hence, this budget speech is different from previous ones.
While PM Modi and Nirmala Sitharaman claim that the budget was prepared based on the suggestions by the economic survey report for spurring up growth, the fact that the distribution of wealth has not been fair and proportional to the population should not be overlooked. This is the biggest drawback of this budget. It cannot be summed up in mere adjective of drawback. The clear case of fascist tendency is shadowed here. In the case of Kerala itself, there are ample examples of the first and second Modi government imposing undeclared sanctions on Opposition-ruled states without allocating to the states deserving share from tax collection. The situation has repeated this time as well. The Finance Minister did not even keep the decorum of mentioning the opposition states including Kerala. Kerala's long-term demands including AIIMS were rejected as usual. Kerala is the most eligible state for flood relief package and health emergency assistance. Everything was ignored. Alongside, it is clear the Center has turned its back on the key recommendations of the Economic Survey Report. The country has been going through the worst unemployment in the last four decades. The government has not taken at face value the proposal to create three quarter of a crore jobs annually. These gaps can also seen in health, agriculture and education sectors. While talking about comprehensive and sustainable well-being, the emphasis is confined to only certain areas. The criteria for these 'zones' is basically for the single goal of five years of governance. The budget speech can ultimately be described as the political policy statement to be in power for the next five years.