For those looking for any angles in the Union Budget referring to the ongoing electoral cycle in Delhi, there was a bit of a kerfuffle when Finance Minister Nirmala Sitharaman announced that the tax rates were being revised downwards for certain slabs. But once the finer details came out, that search too ended.
This was a budget that was delinked from polls, and BJP spokespersons who were to appear on TV debates were told to keep the focus on “simplification and transparency” rather than any big ticket idea that caught the political imagination.
The tax breaks present an either/or option, which weighs in a non exemption regime with a lower tax liability with the choice of going with a tax regime with exemptions and a higher rate. It is a blessing with riders and hence, again, difficult to sell politically.
The larger picture projected on the budget by the party is that it continues the thrust on infrastructure announced by Ms Sitharaman earlier, with a step towards amalgamating the “infrastructure pipeline” with a single window clearance of investment in these projects. This, it is hoped will help get projects off the ground and completed.
For the rural economy too, a 16-point action plan talks of getting the produce out from field to market through Kisan Rail, Udan and warehouses to be set up via Public-Private Partnership (PPP), but the much expected hike in the Prime Minister’s Kisan Samman Nidhi was a no-show. What was announced was an allocation of Rs 2.83 lakh crore for agriculture and allied activities, irrigation and rural development. Of this, Rs 1.60 lakh crore was for agriculture and allied activities alone (a jump from Rs 1.52 lakh crore announced in the interim budget).
Allocations to the rural development ministry also saw a marginal increase from last year, from Rs 1,19,000 crore to Rs 1,22, 000 crore, with the largest chunk (Rs 61,500 crore) reserved for the Mahatma Gandhi National Employment Guarantee Act (MGNREGA), once referred by Prime Minister Narendra Modi as a “monument to the failures of the UPA government”.
Employment generation
Employment generation has been the bane of the Modi government for more than a couple of years now. But even here, there were no handouts, except a year’s extension for start-ups and Micro, Small and Medium Enterprises (MSMEs) for restructuring.
The announcement that there would be a stake sale of Life Insurance Corporation of India (LIC), the crown jewel of the Public Sector Enterprises by the government, while being a bold move will be hard to sell politically.
With no reference to any State election, what then was the big picture? According to a BJP leader, it kept to Prime Minister Modi’s core economic beliefs that there will be no bailouts for the rich, no riderless handouts, a clean-up of processes and regulations with tinkering on the margins.
