Big bang, visionary, blockbuster, bold, bite the bullet, dream budget. These are some of the clichés we have often heard describing annual budgets in the past. This word play in the wake of liberalisation had come to represent a world economic architecture that has of late lost currency with neo-nationalism and protectionism becoming the key words in the post-Trump era. The momentous demonetisation of November 8 further generated an element of uncertainty, expectancy and hope, also whetted by the opposition clamor to postpone as it would influence voters in the five states going to polls soon. The opposition was afraid that the budget would be populist and dole out freebees to attract voters in favour of the NDA. There was scope for that in the hands of a Finance Minister like P Chidambaram for whom budget was nothing but “fudging of figures”. The hall-mark of Arun Jaitley’s budget is that he has restored the credibility of budgetary process.
There is a philosophy behind the budget. Prime Minister Narendra Modi articulated it with poetic poise and finesse: “This budget is a reflection of our dreams. This is futuristic. This will change the face of India.” Yes, rebuilding India, wiping tears from every eye, total eradication of poverty is the cardinal principle of this government. That it is in earnestly translating the dreams of the Prime Minister and giving wings to a billion dreams is Arun Jaitley’s budget and he deserves kudos. Brick by brick, budget after budget he built the economic rationale and template that illustrated the idea of Antyodaya.
The budget for 2017 is the culmination of a thought to reduce the gap between the rich and the poor and the divide between the urban and the rural India. For, the last four budgets of the Narendra Modi government laid more stress on accelerating growth through creating investment climate, controlling inflation, reducing lending rates, building infrastructure and ensuring last mile connectivity. When the new budget talks of digital connectivity for more than 1.5 lakh villages in the next one year, it is about ensuring the facilities of the cities in villages.
What is fascinating is that never in history has the allocation for agriculture loan been doubled. The same has happened in the matter of allocation for rail and road building. The budget has promised to give electricity to all villages by 2018 and provisions have been made to achieve this.
The budget has provided for building 10 million houses for the poor. The built up area of the poor man’s housing has been increased. The budget has laid great focus on building rural connectivity through Grameen Sarak Yojna. The Finance Minister Arun Jaitley said he was making the highest ever allocation of Rs 48000 crore for rural job guarantee scheme.
Creation of new jobs has been one of the most urgent priorities before the government. The Finance Minister rightly pointed out that he was planning to do this through increased public investment. There are many schemes and big allocations for skill development and strengthening the employability of Indian youth. Many projects, including international skill development institutes promised in the budget are designed to achieve this goal. As Jaitley pointed out when roads are built, railway is expanded, new health infrastructure is created and more money is spent on rural job guarantee and farm sector naturally more jobs will be made available.
The budget is particularly focused on ensuring health for all. Equally laudable is the health care schemes for women, children and senior citizens with specially targeted initiatives. Two new AIIMS in Gujarat and Jharkhand have raised demands for more such specialty health care centres in other states. The budget has identified tourism as a major growth propellant and job multiplier. Modernization and rebuilding of 25 selections and making another 300 stations modern and increasing transportation facility netting tourist destinations are significant steps in this direction.
Though the demonetization has swelled the government’s coffers, unlike the previous UPA regime the Modi government is no spent thrift. Financial discipline and check on deficit are the core areas of the NDA development mission. May be because of this approach Modi government has been able to reduce subsidy burden, reduce inflation to an all time low of below three per cent and prices of essential food items have come down in many years. The budget for 2017 is unique in many ways. Not only that the advancing of it will generate an environment for better execution of schemes but it has given a swadeshi, nationalist touch. Clubbing the Railway budget has given scope for a more planned approach to infrastructure building.
Considering the fact that the salaried middle income group is the core of the taxpaying community more concessions to this segment was expected, to reward honesty and incentivize compliance. But whatever relief offered to them will go a long way in protecting the goodwill and the urban vote bank of the party. Another area where the Finance Minister has been generous was in the tax concession to the SME sector. This will greatly enhance India’s position as a manufacturing hub, in which India already enjoying the sixth position in the world. The decision to double allocation for Mudra loans will further incentivize this sector.
Equally laudable is the decision to confiscate the property of loan defaulters like Vijay Mallaya who have fled the country. The government so far has been lenient on the NPA issue which accumulated during the ten year UPA misrule. Some estimate talk of the NPA, existing and written off to the tune of 15 lakh crore. This is a monumental scam. The culprits often go scot free due to political patronage.
In this context the government should be applauded for its bold decision to clean up political funding. This is the single most area of black money. A step in whitening the black is the decision to reduce the funding and donations to trusts. Another parking place for black money. These highlight the government’s sincerity to eliminate black money.
The new budget will give more money in the hands of common man to help him spend more. The budget in that sense is consumer friendly and growth oriented. It should spur demand and induce productivity.
One has often wondered as to what is the big fuss about an annual exercise which after all has a life span of only 12 months. For decades of Congress Finance Ministers had reduced budget making into a routine where pronouncements made only to be repeated year after with no change on the ground. Modi government has changed all that and given meaning to budget as a blue print in nation building. It is targeted, goals fixed and policy driven, credible. Narendra Modi government’s fourth budget presented by Finance Minister Arun Jaitley is once again a marvel in making political ideology making grass roots transformation a reality.
(The writer is a senior journalist)
by R Balashankar