Business Leadership Policy

A responsible budget sans fiscal profligacy!

All inclusive growth strategy is the foundation to an independent developed economy and ready Bharat to play a larger global role K.A.Badarinath Bharat’s finance minister Nirmala Sitharaman presented a responsible budget on behalf of the BJP-led government on Wednesday. It is on expected lines. Conservative in content and spirit, but the budget for 2023 – 24 has grand vision for taking Bharat to big boys club globally. It lays the foundation for Bharat’s centennial run in 2047 by the time it seeks to evolve as an independent, inclusive and developed economy that is sustainable. The Rs 45 lakh crore budget swan song is to best utilize the ‘amrit kaal’, intervening 25-years to get there and get big. It’s in continuation of the Bharat@100 line given in both the Presidential speech and pre-budget economic survey on Tuesday. Women’s empowerment, skilling our vast human resource, expansion of our tourism industry and achieving green growth as areas that have been identified in the grand vision presented for 2047. Seven priorities laid-out by Narendra Modi government in the budget point to reshaping Bharat’s economic and development paradigm. She gave the budget civilizational connect by christening these priorities as ‘saptarishis’ that guided this country for millennia. Nirmala Sitharaman who has now turned a veteran with her fifth budget presentation, tenth for the Narendra Modi government did not lose on basics. She pushed peddle hard staying the course on fiscal consolidation and not going for the easy option of ‘reckless spending’ or profligacy, hall mark of a government that faces polls in a year or so. On most parameters like fiscal deficit pruning it to 6.4 per cent in next financial year and 4.5 per cent by 2025-26 has been projected. Keeping the jobs-led green growth on track at 6.5 per cent in 2023-24 and achieve double digit expansion in medium term is what the government aspires to achieve. Even for current fiscal, the government managed to keep the deficit at 6.4 per cent on strength of tax revenues and expanded the spending to Rs 41.9 lakh crore. Grand standing on global vision and fiscal prudence did not mean that Prime Minister Modi or his protégé Sitharaman lost out on facing Lok Sabha elections in 2024 preceded by assembly elections in seven states this year. Jobs and environmentally sustainable growth was articulated by Sitharaman in the backdrop of ‘rozgar melas’ that Modi has been holding last six months giving out appointment letters to thousands of first time work seekers. Vocal middle-class voters that have been main stray of this government also got their due especially the honest taxpayers with across the board tax concessions, remissions and exemptions with limits rejigged. In the process, Nirmala Sitharaman had to forego Rs 35,000 crore revenue that the government could afford, given the buoyancy in tax mop up. From economic management side, this would spur further demand for goods and services having multiplier effect on growth impulses. But, opposition political formations are bound to criticize the last full budget of this government in present term as ‘election oriented’. Opening line of the budget speech itself was strong on political messaging as it enlisted youth, women, farmers, backward classes, scheduled castes, tribes and economically weaker sections to be targeted in making Bharat’s economy ‘inclusive’, open and prosperous. Budget is the third instance when the government chose to present its report card of nine years in governance. Nirmala Sitharaman’s numbers were impressive at 11.7 crore households getting toilets, 9.6 crore cooking gas connections, 220 crore Covid vaccinations for 102 crore persons, 47.8 crore jan dhan yojana bank accounts, 44.6 crore getting insurance cover and 11.4 crore farmers getting cash support of Rs 2.2 lakh crore. Not just addressing the voters’ class, Nirmala Sitharaman managed to keep the industry and markets trigger positive. Two big decisions that have had positivity include 33 per cent increase in infrastructure investment at a whopping Rs 10 lakh crore in 2023-24, way above Rs 7.3 lakh crore in current fiscal. This is three times what was possible in 2019-20. If one were to take the grants given to support capital assets in states, capital expenditure moves up to Rs 13.7 lakh crore translating to 4.5 per cent of GDP. Capital outlay of Rs 2.4 lakh crores to railways, Rs 75,000 crore to developing critical transport infrastructure and logistics is an addition. Second trigger was that most consumers across tax brackets got relief thereby allowing extra money for investment or purchases. Thirdly, the government managed to keep its public finances in order without making any major demand on industry through corporate taxes. Modi government’s budget also makes sincere attempt at building confidence in populace at large and swell with pride in their Bharat’s citizenship especially while making out a case for momentous G-20 Presidency and economic surge as fastest growing global economy. Formalization and digitization are factors that would be pushed by the government thereby weeding out corruption in government schemes and shrinking the informal economy. For instance, digital payments led to 7400 crore transactions valued at Rs 126 lakh crore in 2022 alone. Jobs in formal sector have also grown and this reflects in EPFO membership that swelled to 27 crore. Agriculture as a big priority is no surprise and shift to millets based natural farming is a big idea that government has sold through the budget. ‘Shri Anna’, an indic name for millets like Jowar, Ragi, Bajra, Kuttu, Ramdana, Kangni, Kutki, Kodo, Cheena and Sama, resonates as an initiative to make Bharat a global hub for these wholesome nutritious grains. Another significant shift is taking economic growth on green pathway. Apart from the dedicated hydrogen mission, Rs 35,000 crore was set aside to enable energy transition from carbon fuels, green credits, 500 waste to wealth projects with Rs 10,000 crore investment and renewable energy evacuation from Ladakh supported through budget resources of Rs 8300 crore. Skills development got a new heft in its 4.0 version with 47 lakh youth getting trained for taking up jobs

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‘Bharat to be a developed nation by 2047’

25-year roadmap to get there may be unveiled even as BJP-led Narendra Modi juggernaut gets ready to rollout seeking a third term K.A.Badarinath Twenty five years roadmap for turning Bharat into a modern, independent and developed economy with a large say in global affairs is the common theme that runs through both Presidential address at the start of Parliament’s budget session and economic survey for 2022-23. Both President Draupadi Murmu and Finance Minister Nirmala Sitharaman did the honours in the colonial era Parliament building as they reflected Prime Minister Narendra Modi’s resolve to roll out firm plans for Bharat in ‘Amrit Kaal’ spread over to 2047. Evolving a fully self-reliant country sans poverty, prosperous middle class with youth and women at forefront have been envisaged by the Modi government that will allow fulfilling all humanitarian obligations globally. Focus on ‘unity in diversity’ in Presidential address also marks yet another assertion from the government that Bharat will continue to cherish, embellish and groom all minorities by faith, worship and sections of a larger Hindu society. This may perhaps be intended at demolishing a false narrative being constructed by few global outlets that minorities in Bharat are being hounded out or subjected to genocide. The roadmap to achieve the ‘golden future’ may draw inspiration from Bharat’s glorious past, freedom struggle and 1.4 billion people’s resolve. This is the line pursued by Modi government as it readies to draw curtains on ‘amrit mahotsav’ that marks 75-years of Bharat’s independence after having pushed back colonial occupiers. Presidential address and economic survey fine print that outlines the blue print for a ‘developed country’ is nothing short of a grand stand vision for Bharat joining the big boys globally as a developed nation. Both the documents proudly declare Bharat as fifth largest economy that would expand to $ 3.5 trillion in two months. The federal budget to be presented on Wednesday by Nirmala Sitharaman may provide more clues or offer different specs to attaining the exulted status of a developed economy. Economic survey has already talked about achieving 10 – 12 nominal GDP growth in medium term as a commitment and objective to taking India big on world map as second or third largest economic powerhouse. Both Presidential address and the survey simultaneously articulated the nine years report card of Narendra Modi government’s performance across sectors. Given that BJP-led ruling alliance will have to face the electorate in May – June 2024 seeking a third term, this report card serves as a ready reckoner of what has been done during last nine odd years. Similarity does not end here. Presidential address lists out the government’s achievements in socio-economic sectors thereby improving people’s lives. Concomitantly, the survey provides a lengthy list of economic reforms and fundamental change in structural governance brought in by the Modi government. Bringing transparency and openness into public life may be yet another theme point apart from weeding out corruption at different levels. Corruption is the big plank on which BJP-led Hindu centric formation assumed power with complete majority for first time in 2014. On the reforms front, both President Murmu and Finance Minister Sitharaman have listed Goods and Services Tax (GST) as a big success story in tax reforms. While the states still have issues on GST, revenue sharing formula and several hurdles in ending the fake bills, the reform is definitely a game changer given that multitude of taxes have been phased out. Economic survey for the first time introduced a complete assessment of how peoples live changed owing to improvement in social sector indices. On the other hand, President Murmu reeled out figures to reflect the on-ground change brought about. For instance, in digitized economy, Bharat has reported Rs three lakh crore worth transactions on the e-market place. Similarly, over Rs 27 lakh crore have got transferred into bank accounts of the beneficiaries in 300-odd schemes through direct benefit transfers. Over 50 crore people have been treated under Ayushman Bharat scheme and accessed affordable medicines from 9000 jan aushadi kendras.This led to saving of over Rs 80,000 crore that could have been forked out by people on health treatment. Over 7.5 crore households have got access to tap water. Under what started as an anti-Covid 19 drive over Rs 3.5 lakh crore worth food grains were provided to the poor and needy. Rs 2.25 lakh crore distributed as support to farmers. Out of this, Rs 50,000 crore has gone to women farmers alone.Over 36,000 hamlets of tribals have virtually been adopted under a PM’s scheme. 500 blocks seem to have got a facelift as ‘aspirational’ campaigns. Over nine crore women have benefited through self help groups while 70 per cent of small borrowers from banks were women. President’s address provided another 100 such data points to support the Modi government’s articulation on bringing about ‘transformational shift’ in people’s lives. This also makes us believe that quietly, Modi government is getting into election mode especially after the two days national executive committee meetings of BJP held in New Delhi. On the global front, Modi government may speak on two issues prominently as a sovereign outfit and as president of G-20 as well as SCO. A peek into tomorrow’s budget may provide more clues to Modi’s big vision statement.

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A responsible budget sans fiscal profligacy!

‘Bharat to be a developed nation by 2047’