The budget Politics

Their charge is Prime Minister Narendra Modi “failed in his examination as the budget promises acchhe din (good days) only for the hoarders of black money and not for the common people”.
The budget Politics
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Budget 2016 is out. That the rural economy is the focus, does it make it a 'political budget'? That the infrastructure is the thrust area, does it make it a 'progressive budget'?

Prime Minister Narendra Modi in his Mann Ki Baat while equating the presentation of the budget with an "exam", had said, "I've an exam today, I am fully confident."

Did he pass his exam?

Nitish and Lalu do not think so. Their charge is Prime Minister Narendra Modi "failed in his examination as the budget promises acchhe din (good days) only for the hoarders of black money and not for the common people".

India's noted economist and former PM Manmohan Singh doubts the government's announcement that farmers' income would be doubled in the next five years. He simply says it is an "impossible idea."

Chidambaram, former finance minister rejects the budget as not farmer friendly. He has a basis to say it. "The budget did not talk about crucial agriculture pricing."

This all is politics, though the arguments not bereft of substance. Has it become fashionable with every opposition to criticize the budgets of the dispensation in power; and at the same time customary for every government to do some politics in budgets?

The successive Congress governments at the centre had almost every time tried to show a "human face" in its budgets. It is the Congress which probably had announced the biggest ever loan waiver for the farmers of the country to sound "politically correct."

Did the position of the farmers improve then really?  Did it liberate them from the yoke of money lenders? Without seeking to find answers, the BJP also tried to be "politically correct."

Not making the corporate sector the focus of the budget, it played master stroke. The signal it sent across is "we are not a pro-rich government."  If you undermined the need for this signal, recall Delhi and Bihar. Despite Modi wave, BJP juggernaut could not run in these states.  

So enhancing allocations for MGNREGA, a UPA flagship programme, is not without reason. Strengthening rural economy, a good economic proposition for the progress of this country notwithstanding, the proposal seems more to be necessitated by the upcoming elections in some states.

Jaitley's pledge to double farmers' incomes in the next five years through more than 40 programs may not carry the budgetary provisions, yet the 'intent' is clear. "We too are pro-poor, pro-farmer."

No wonder, all that the BJP criticized the Congress for, it announced in this budget for the farmers! Expansion in a rural job-generating program is just an example on hand.

Valuing electorate as the real force in the democracy, the BJP can break from the long-held practice of exemption to EPF and annoy some six core provident fund subscribers in the country, yet it cannot go against the 60 crore farmers where the image of the party required a 'makeover'.

The overemphasis of the budget on the rural economy thus is amply understandable: The proposals for investing "in everything from irrigation to village roads and soil monitoring; from shifting wholesale markets online to supporting prices for agricultural produce and spending for rural development." Don't forget, investments in irrigation yields results quickly. This year you spend the money, next year the results.

Let us come to the economic side. There are certain challenges. In the time of global headwinds and rising NPAs, the finance minister has proposed Rs 25,000 crore for recapitalization of the Public Sector Banks in India. Besides, the government will unveil a roadmap for consolidation of PSBs. Given the scale of problem the banks are facing, Rs 25,000 crore allocation wont' be sufficient.

Another challenge is that the budget tries to accomplish the difficult task of spending more while reducing the budget deficit. Its failure to bring down the fiscal deficit to 3.5 per cent of GDP in the coming fiscal year could have negative impact on the international investors. Hurting investments could only add to the problems.

Twirling to the other side, it would be interesting to see how the budget that contained nothing for Jammu and Kashmir would impact the state politics in the coming days.

The coalition partners in the previous government, PDP and BJP after the demise of former chief minister Mufti Muhammad Sayeed, have shied away from looking into each other's eye.

With its demand for confidence building measures and some major initiatives – both political and economic, from the BJP led government at the centre in respect of Kashmir (at least grapevine tells us so), the PDP has only made complex its future tie-up with the BJP.

To go for further tie-up, the PDP would need something sellable to the people of Kashmir. The traders' community, the common people, whose lives have been disturbed by the worst ever floods Kashmir saw last year, are not interested in the niceties of budget or budgeting. They even don't mind a political budget. They need relief whichever way it comes to them.

If this budget was some hope for PDP, it has failed it. Political uncertainty that has become the fate of this state, Jammu and Kashmir may, I am afraid, have to live with for some more time.

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