First Take | Budget 2021

Good but could have been better

At this point our focus should be on removing supply bottlenecks than on creating much more additional demand. - Raghuram Rajan at Davos

About 49% of the labour force is engaged in agriculture. Bumper harvest: low prices, Drought: zero income. Suicides by farmers all across the country. Can the Central government shirk responsibility, saying agriculture is a State Subject?

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A welcome announcement is the MSP for Rabi crops at least at 1.5 times the cost involved, to be extended to other crops. A fool proof mechanism will be put in place to ensure adequate price for farm produce.

Marketing is one area which has escaped the attention of the FM. The marketing mechanism announced in the budget speech falls short of the recommendations of the Ashok Dalwai Committee on doubling farmer incomes. It had suggested that the One India market will be benefited if agricultural marketing is brought under the Concurrent List. Marketing should operate on a pan-India level. One nation, One market concept should be extended to agricultural produce across States.

National Highways hope to construct 9000 km in 2017-18 and Bharat Mala 35,000 km at a cost of ₹5,35,000 crores. There is much to be learnt from the idea of the Golden Quadrilateral successfully promoted and implemented by Atal Behari Vajpayee.

The budget speech forgets the fact that the bulk of the farm labour consists of farmers who don’t own the land. Will there be some measure to help the farmer own the land he cultivates?


Admittedly, quality of education is a cause for concern. According to ASER, 50% of the children in the age group 14 to 18, despite having been schooled, cannot read, write or do basic arithmetic. Government spends on education 5% of the GDP.

It is not enough to train teachers. Education should be imparted to the earlier generation of illiterate parents. Digital kiosks in schools to educate the parent is an absolute necessity. The FM talks of Institutes of Eminence, instead of vocational institutes in every town and every district. We need to build up a large army of carpenters, tool smiths, masons etc.

The government has agreed to contribute 12% of the wages of the new employees to the EPF for all the sectors. This takes care of the organised sector. No thought has been given to the large pool of workers in the unorganised sector.


The flagship National Health Protection scheme to cover 50 crore beneficiaries up to ₹5,00,000 per family per year for secondary and tertiary care hospitalisation is no doubt laudable. The government is moving towards the goal of Universal Health Coverage, setting up 24 new government medical colleges by upgrading existing district hospitals. Why is there is no talk of Primary Health Centres (PHCs) in rural areas? Government spends 3% of the GDP on healthcare.

There is no mention of school for nurses. The private sector contributes 51% of the bed capacity and handles 45 million admissions every year. This can generate 75 lakh direct jobs within five years. Europe and Middle East import nurses from India.

The budget document makes no mention of policy changes required in our patent laws to help our pharmaceutical industry. Help on the lines of policy support to the IT sector should be rendered to the pharmaceutical sector by evolving suitable patent laws of International standards. Health care should be given national priority status. New hospitals should be given tax holidays and if possible land on 99-year lease.

(T.C.A. Ramanujam, Former Chief Commissioner, Income Tax, With T.C.A. Sangeetha)

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Printable version | Aug 3, 2021 8:55:38 AM |

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